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Nifty eyes 7800 in start to crucial Fed week

Indian equities may be off to a positive start but will likely tread water for the early part of the day as markets kick off an extremely crucial week — one in which the Federal Reserve is likely to consider for the first time in nine years whether to increase interest rates.

TheNewsInternational Team

Indian equities may be off to a positive start but will likely tread water for the early part of the day as markets kick off an extremely crucial week — one in which the Federal Reserve is likely to consider for the first time in nine years whether to increase interest rates.

Key Asian markets were trading mixed with Hong Kong leading with gains of 1 percent while Nikkei was down the most at -0.3 percent.

In Singapore, SGX Nifty was trading marginally above 7,800, up 0.3 percent.

Traders say the market’s movement this week, especially on Friday, will be crucial as the months-long uncertainty over the Federal Reserve’s monetary policy decision will come to an end.

The odds of the Fed hiking rates while being even earlier have somewhat reduced following recent volatility in global equity and currency markets, experts say, but they add that even if a rate hike does take, it could be priced in.

But they also maintain that equities may continue to stay more volatile — something that was witnessed Friday when the Nifty bounced off from deep in the red to close only marginally lower.

In other asset classes, gold traded at a month low while crude fell after Goldman Sachs made a dramatic call, saying possibility existed of oil falling to USD 20 per barrel.

In macro data, industrial production came in ahead of estimates at 4.2 percent but markets will focus on WPI and CPI inflation data today that will offer clues into whether the Reserve Bank of India will ease interest rates for the fourth time this year.

While in stock-related news, JK Tyre will be in focus after it said over the weekend it had acquired Kesoram Industries’ tyre making unit.

Castex, belonging to the debt-laden Amtek Group, will also likely see movement after CNBC-TV18 reported the company may be sued by Standard Chartered for converting its FCCBs into shares without sanction from bondholders.

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