Market may extend recent gains

Indian markets are likely to extend two-day gains. Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could rise 41 points at the opening bell.

Moody's Investors Service on Tuesday reportedly slashed India growth forecast for calendar year 2020 to 0.2%, from 2.5% projected earlier. For 2021, Moody's expects India's growth to rebound to 6.2%. Moody's said the economic costs of coronavirus crisis amid the near shutdown of the global economy are accumulating rapidly.

Overseas, Asian shares were trading with small gains on Wednesday as investors await the US Federal Reserve's decision on interest rates. Markets in Japan are closed on Wednesday for a holiday.

 

The Fed is expected to announce its interest rate decision later in the global day. Investors will look for guidance on the U.S. central bank's future path of interest rates as the country looks toward gradually reopening its economy.

In US, Wall Street's major indexes lost ground on Tuesday as investors moved out of market-leading growth stocks, though a rotation into cyclical value stocks indicated hopes of economic revival as states began to relax restrictions enacted to fight the deadly COVID-19 pandemic.

Back home, domestic shares rallied on Tuesday, buoyed by positive global cues. Financial stocks extended gains for the second day, following the Reserve Bank of India (RBI) offering liquidity support to mutual funds for meeting the liquidity requirements. The barometer S&P BSE Sensex advanced 371.44 points or 1.17% at 32,114.52. The Nifty 50 index gained 98.60 points or 1.06% at 9,380.90.

The trading activity on that day showed that the foreign portfolio investors (FPIs) sold shares worth a net Rs 122.15 crore on 28 April 2020, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 389 crore on 28 April 2020, as per provisional data.

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