Indian stock market: 7 key things that changed for market overnight - Gift Nifty, US jobless claims to oil price rally

Indian stock market: The domestic equity market is expected to open lower on Friday tracking subdued global market cues amid cautiousness.

While most Asian markets were closed for holiday, US stocks ended little higher overnight as investors reacted to corporate earnings.

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On Thursday, the Indian stock market indices ended a percent lower each, weighed down by rate-sensitive sectors, following the Reserve Bank of India’s (RBI) expected decision to maintain its key policy rates unchanged for a sixth consecutive meeting.

The Sensex declined 723.57 points, or 1.00%, to end at 71,428.43, while the Nifty 50 settled 212.55 points, or 0.97%, lower at 21,717.95.

“RBI remains resolute in bringing down inflation to its medium term target of 4% in a timely and sustainable manner. The Monetary Policy continues to be actively disinflationary to ensure anchoring of inflation expectations and fuller transmission. No change in stance could mean that a rate cut soon remains unlikely. The first rate cut may happen post the new Govt at the Centre being sworn in. Equity markets sold off despite low expectations as traders seem to be waiting for a trigger. This outcome may not have an effect beyond a couple of days,” said Dhiraj Relli, MD & CEO, HDFC Securities.

Also Read: Buy or sell: Vaishali Parekh recommends three stocks to buy today — February 9

Here are key global market cues for Sensex today:

Asian Markets

Most Asian markets are partially or fully closed on Friday as the region enters the Lunar New Year holiday period, while Japan’s Nikkei set a fresh 34-year high.

Stock markets in China, South Korea and Taiwan are shut, while Singapore and Hong Kong will see a half day of trading.

Japan’s Nikkei rose 0.64%, breaching the 37,000 mark for the first time in 34 years, while the Topix was flat.

Softbank Group share price rallied almost 10%, extending gains from the 11.06% jump in the previous session after chip designer Arm’s shares surged 48% overnight.

Also Read: Dividend stocks: Sun Pharma, P&G Hygiene, BEL, RITES, among 18 shares to trade ex-dividend today

Gift Nifty Today

Gift Nifty was trading around 21,757 level, as compared with Nifty futures’ previous close of 21,829, indicating a negative start for the Indian stock market indices.

Wall Street

US stock market indices ended higher on Thursday with the benchmark S&P 500 index briefly hitting the 5,000-point milestone for the first time, as investors reacted to earnings reports, jobs data and remarks from US Fed policymakers.

The Dow Jones Industrial Average gained 48.97 points, or 0.13%, to 38,726.33, the S&P 500 rose 2.85 points, or 0.06%, to 4,997.91. The Nasdaq Composite ended 37.07 points, or 0.24%, higher at 15,793.72.

Among stocks, ARM Holdings shares jumped 47.9%, Walt Disney stock price surged 11.5%, Spirit Airlines shares added 3.3%, while Ralph Lauren stock rallied 16.8%. PayPal shares dropped 11.2%.

Also Read: S&P 500 finishes just shy of 5,000 after latest push

US Initial Jobless Claims

The number of Americans filing new claims for unemployment benefits fell more than expected last week. Initial claims for state unemployment benefits dropped 9,000 to a seasonally adjusted 218,000 for the week ended February 3. Economists polled by Reuters had forecast 220,000 claims for the latest week.

Oil prices rally

Crude oil prices gained more than 3% on concerns of escalating conflict in the Middle East after Israel rejected a ceasefire offer from Hamas. 

Brent futures closed higher by $2.42, or 3%, at $81.36 a barrel, while the US West Texas Intermediate crude rallied $2.36, or 3.2%, to $76.22.

Need more time before supporting rate cuts, says Fed’s Barkin

Federal Reserve Bank of Richmond President Thomas Barkin said Thursday the central bank has time to decide what’s next for monetary policy while it waits for further assurance that inflation is indeed falling back to target, Reuters reported.

Dollar rises, yields spike

The US dollar rose after data on unemployment benefits again pointed to a resilient US labor market, Reuters reported. The dollar index was last up 0.14% at 104.16, after hitting 104.43 following the initial claims report. 

The two-year Treasury yield, which reflects interest rate expectations, rose 3.4 basis points to 4.456% and the 10-year yield was up 7 basis points at 4.168%.

(With inputs from Reuters)

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