Indian stock markets may trade largely steady on Friday amid firm global cues but September quarter earnings are expected to keep investors cautious. Asian shares and US stock futures rose on Friday after US President Donald Trump said he would meet with China’s top trade negotiator, while the pound sterling retreated after rallying on revived hopes of a possible Brexit deal.
Investors' renewed appetite for riskier assets weighed on safe-haven yen and US Treasury prices, while oil stayed on firm ground following comments about possible supply cuts from the head of OPEC.
In early Asian trade, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.5%, following from gains on the Wall Street. Australian shares climbed 0.8%, while Japan's Nikkei stock index gained 0.9%.
The more bullish market mood came after a first day of trade talks between top US and Chinese negotiators that Trump characterized as “very, very good."
A White House official said the talks had gone “probably better than expected" and a US Chamber of Commerce official briefed by both sides raised the possibility of a currency agreement this week.
Back home, the government’s immediate priority is to infuse liquidity into the system and a decision on the year’s fiscal deficit target will be taken close to when the Union budget will be presented, finance minister Nirmala Sitharaman said.
“We are in a challenging position, but my current focus is to ensure that money reaches the hands of the people, to make sure that government’s own dues are not kept pending and are paid in time," Sitharaman said at a roundtable meeting with editors in Mumbai.
On Thursday, the economic offences wing (EOW) of the Delhi police arrested former co-promoter of Religare Enterprises, Malvinder Mohan Singh, in Ludhiana (Punjab) for allegedly causing wrongful loss worth ₹2,397 crore to Religare Finvest Ltd, a senior Delhi police official said.
Tata Consultancy Services (TCS) reported a 1.8% rise in consolidated net profit at ₹8,042 crore for the quarter ending September 30, 2019. It had posted a net profit of ₹7,901 crore in the year-ago period. Revenue of TCS grew 5.8% to ₹38,977 crore in the July-September quarter compared to ₹36,854 crore in the same quarter of the previous fiscal, it added.
Shares of Infosys Ltd are also likely to be in focus today as the IT major will announce its September quarter results today.
Among currencies, the dollar rose 0.1% against the yen to 108.07, while the euro was flat at $1.1004 and the pound was slightly lower, fetching $1.2432.
The dollar index, which tracks the greenback against a basket of six major rivals, was down at 98.663 after posting its biggest daily drop in five weeks on waning safe-haven demand for the currency.
The British pound jumped nearly 2% on Thursday, its biggest daily gain since March, after Irish Prime Minister Leo Varadkar said a Brexit deal could be clinched by the end of October following what he called a very positive meeting with his British counterpart, Boris Johnson.
The move away from safe havens also lifted the yield on benchmark 10-year Treasury notes to 1.6716% compared with the US close of 1.656% on Thursday. Yields rose across the curve, with two-year notes yielding 1.5464% compared with a US close of 1.53%.
In commodity markets, oil prices remained higher after the head of OPEC said the organisation could take action to balance oil markets, including a deeper cut in oil supplies.
US crude was up 0.43% to $53.78 a barrel and global benchmark Brent crude LCOc1 was up 0.46% at $59.37 per barrel.
Rising risk appetite tarnished gold’s appeal, pushing spot gold down 0.16% to $1,491.65 per ounce.