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Business News/ Markets / Stock Markets/  10 things that changed for the stock market overnight - Gift Nifty, US GDP to Accenture’s muted earnings forecast

10 things that changed for the stock market overnight - Gift Nifty, US GDP to Accenture’s muted earnings forecast

The Asian markets rebounded, while the US stock market ended higher overnight led by tech stocks as Treasury yields retreated.

Japan’s Nikkei 225 rose 0.1%, while Topix fell 0.2%. (Image: AP)Premium
Japan’s Nikkei 225 rose 0.1%, while Topix fell 0.2%. (Image: AP)

The Indian stock market indices, Sensex and Nifty 50, are likely to open on a cautious note amid mixed global cues. 

The Asian markets rebounded, while the US stock market ended higher overnight led by tech stocks as Treasury yields retreated.

On Thursday, the domestic equity benchmarks settled around a percent lower amid volatility due to the monthly F&O expiry and dragged by weak global cues.

Going ahead, the weakness in the market is likely to extend till the worry over the elevated oil prices and higher interest rates remains, posing a risk to the earnings growth trajectory. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd

Asian Markets

Asian markets traded higher on Friday following overnight gains on Wall Street and release of key economic data in Japan.

Japan’s Nikkei 225 rose 0.1%, while Topix fell 0.2%.

Hong Kong’s Hang Seng index futures traded at 17,554, compared to the HSI’s close of 17,373.03.

South Korean and mainland Chinese markets are closed for a holiday.

Australia’s S&P/ASX 200 gained 0.31%.

Meanwhile, Gift Nifty was trading at around 19,636 level as against Nifty futures’ previous close of 19,655, indicating a negative start for the Indian benchmark indices.

Also Read: Buy or sell: Vaishali Parekh recommends three stocks to buy today — September 29

Wall Street

US stock market indices ended higher on Thursday as a rise in Treasury yields stalled, while investors assessed economic data.

The Dow Jones Industrial Average rose 116.07 points, or 0.35%, to 33,666.34, while the S&P 500 gained 25.19 points, or 0.59%, to 4,299.70. The Nasdaq Composite ended 108.43 points, or 0.83%, higher at 13,201.28.

Among stocks, Accenture shares slumped 4.3% after the IT services firm forecast full-year earnings and first-quarter revenue below Wall Street targets. 

Micron Technology shares dropped 4.4% after the chip company forecast a bigger loss than analysts had expected.

Nike shares were up about 8% in extended trading.

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US real GDP grows 2.1% YoY Q2

The real gross domestic product (GDP) of the United States expanded at an annual rate of 2.1% in the second quarter, the US Bureau of Economic Analysis' (BEA) final estimate showed. 

Policymakers at the US central bank see the US GDP growing 2.1% this year, a notable upgrade from the 1% growth projected in June, and expanding by 1.5% next year.

Read here: US real GDP grows 2.1% YoY Q2 in line with Street estimates

Accenture forecasts first-quarter revenue below estimates

Accenture, the IT services giant reported its Q4 revenue numbers within its targeted range but fell short of estimates. The company forecasted the first-quarter revenue below the Wall Street targets signaling that high inflation and interest rates pressures will hurt demand through next year.

The revenue of the company rose 4% to $16 billion in the fourth quarter ended August 31, as against estimates of $16.08 billion.

Read here: Accenture warns of first-quarter revenue below estimates as IT spending remains under pressure

Accenture expects first-quarter revenue in the range of $15.85 billion to $16.45 billion, while analysts polled by LSEG forecast $16.43 billion, up 4% year-on-year, Reuters reported.

The company also forecast fiscal 2024 adjusted earnings per share to be in the range of $11.97 to $12.32, below estimates of $12.45. The mid-point of its revenue growth forecast of 2% to 5% in local currency also fell short of estimates, the report added.

Nike beats profit estimates; shares surge

Nike, world’s largest sportswear maker, beat Wall Street estimates for first-quarter profit led by higher prices of its sneakers and apparel.

Nike reported a profit of $1.45 billion, or 94 cents per share, beating estimates of 75 cents per share. The company’s total revenue of $12.94 billion missed analysts' estimates of $12.98 billion. 

The company also forecast a 100 basis point increase in second-quarter gross margins, following six consecutive quarters of declines, on the back of fewer planned markdowns and lower freight costs.

Nike shares were up about 8% in extended trading.

Fed’s Barkin says too early to know if more rate hikes needed

Federal Reserve Bank of Richmond President Thomas Barkin said it’s too soon to know if another interest-rate increase will be needed, noting that headwinds from a potential government shutdown could create more uncertainty for the economy.

“I don’t think the kind of growth we saw in the second, third quarter is likely to continue," Barkin said Thursday during an interview with Bloomberg Television. Asked if he thought another rate hike was needed this year, Barkin said it is “too early for me to know. I think there are a wide range of possible outcomes."

Japan’s economic data

Core inflation in Japan's capital slowed in September for the third straight month mainly on falling fuel costs, data showed on Friday. The Tokyo core consumer price index (CPI), which excludes volatile fresh food but includes fuel costs, rose 2.5% in September from a year earlier, against a median market forecast for a 2.6% gain.

Meanwhile, Japanese retail sales rose 7.0% in August from a year earlier, government data showed on Friday, marking an 18th straight month of gains.

Japan's jobless rate stayed flat at 2.7% in August from the previous month, data showed.

India falls short of FTSE Russell government bond index inclusion

Global index provider FTSE Russell kept India on a watch list for inclusion in the FTSE Emerging Markets Government Bond Index (EMGBI), Reuters reported.

“Areas for improvement in the Indian government bond market structure highlighted by international investors remain largely unchanged from the previous March 2023 review," FTSE said in its annual country classification review.

Read here: FTSE Russell keeps India on a watch list for inclusion in emerging markets government bond index

India’s CAD widens to $9.2 billion in June quarter

India's current account deficit (CAD) widened to $9.2 billion in the first quarter of FY24, from $1.3 billion in the preceding quarter owing to a higher trade deficit, lower surplus in net services, and a drop in private transfer receipts, the Reserve Bank of India (RBI) said on Thursday.

The CAD in the April-June quarter amounted to 1.1% of GDP as compared to 0.2% of GDP in the January-March quarter. CAD in April-June 2022 stood at $17.9 billion, or 2.1% of GDP.

Read here: India's current account deficit widens to $9.2 billion in June quarter

Abu Dhabi's IHC to sell its investments in Adani's 2 companies

Abu Dhabi conglomerate International Holding Company (IHC) said it will dispose of its investment in India's Adani Green Energy and Adani Energy Solutions, reported Reuters.

The IHC held over one percent stakes in two Adani group companies and now entered into a pact with a buyer to dispose of its investments. The value of its holdings in these two firms stood at 3,327 crore, according to Thursday’s closing in stock markets.

Rad here: Abu Dhabi's IHC to sell its investments in Adani's 2 companies

(With inputs from Reuters)

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Published: 29 Sep 2023, 07:21 AM IST
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