Strong opening likely amid positive global cues

The good news this Thursday morning for the bulls is that trade concerns between the US and China have cooled a bit with the US and China granting tariff exemptions to each other ahead of the next round of trade talks. Also, in the last trading session, the FPIs were net buyers as they bought shares worth about Rs 267 crore. As per the early action on the SGX Nifty, the Indian indices are set to open on a strong note. At the time of writing, the SGX Nifty was up by 34 points trading at 11,071 level. On the macro front, India’s industrial production for July and retail inflation (CPI inflation) data for August is set to be released later in the day. 

Most of the stocks indices in Asia are trading in the green on Thursday morning and fuelling the optimism is a strong close overnight on the Wall Street after the US and China granted tariff exemptions to each other ahead of the next round of trade talks. The Japanese stock index Nikkei 225 advanced 0.88 per cent, China’s Shanghai Composite was up 0.06 per cent, while Hong Kong’s Hang Seng has shed 0.62 per cent.

Back home on Wednesday, key benchmark indices ended with modest gains on a range-bound day with Nifty adding 0.30 per cent to settle at 11,036 and BSE Sensex gaining 0.34 per cent to close at 37,271. The broader markets continue to outperform with Nifty Midcap and Smallcap surging 0.89 per cent and 1.49 per cent, respectively. There was mixed reaction on the sectoral front, with Nifty Realty and Nifty Auto being top gainers. On the flip-side, Nifty IT and Nifty FMCG were top losers.

The US equity markets, after a strong start, remained buoyant through Wednesday’s session. Investors on Wall Street were pleased following news that China has decided to suspend tariffs on some US products, days ahead of a planned meeting between trade negotiators from the two countries. The Dow jumped 0.9 per cent, S&P climbed 0.7 per cent and the tech-heavy Nasdaq soared 1.1 per cent.

The European indices ended Wednesday’s session in the green after China announced tariff exemption on some US products and market participants anticipated monetary policy decision from the ECB with elevated expectations of new stimulus measures. Germany’s DAX rose 0.64 per cent, France’s CAC 40 moved up 0.44 per cent and UK’s FTSE 100 surged 0.96 per cent.