Indian stock markets may continue to remain volatile on Wednesday, with investors awaiting the Reserve Bank of India's policy statement which is due on 5 December. Asian shares extended their losses in early deals today after US President Donald Trump said a trade deal with China might have to wait until after the 2020 presidential election, dashing market hopes for a quick preliminary agreement.
Investors turned to safe-haven assets, boosting bond prices and sending gold to a one-month high, while MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.4%. Japan's Nikkei dropped 1% in early trade. Australia's S&P/ASX200 was down 1.6%, having shed almost 4% since closing on Monday.
The yield on benchmark US 10-year US10YT treasuries fell as low as 1.6930% overnight, the sharpest fall since May. It stood at 1.7242% on Wednesday.
Trump told reporters in London that there is “no deadline" for an agreement with China to end the tit-for-tat tariff war that has hurt global growth.
US Commerce Secretary Wilbur Ross on Tuesday said no high-level meetings are scheduled and the parties still needed to sort out details about Chinese purchases of US farm products and an enforcement mechanism. If there is no deal or substantial progress before 15 December, tariffs on remaining Chinese imports, including cell phones, laptop computers and toys, will take effect, Ross said.
A wave of selling on Wall Street followed, with the Dow Jones Industrial Average shedding a percentage point, the Nasdaq half a percentage point and the S&P 500 0.66%.
Back home, India’s top two private banks, HDFC Bank Ltd and ICICI Bank Ltd, on Tuesday fought to lay their hands on client shares that Karvy Stock Broking Ltd had pledged with them, seeking to recover ₹1,000 crore they had lent to the brokerage.
Around ₹7 trillion rides on the Shiv Sena-led Maharashtra government’s decision to review several high-profile infrastructure projects approved by the previous government, with a cabinet meeting on Tuesday putting many of them under the scanner.
Rating agency S&P has reaffirmed India’s sovereign credit rating with stable outlook and expects Asia’s third largest economy to grow strongly over the next two years, India’s finance ministry said citing a summary publication from the rating agency.
South-based private sector lender CSB Bank will make stock markets debut on 4 December 4 it's initial public offering (IPO) was subscribed 87 times. The share sale was between 22-26 November with a price band of ₹193-195 per share.
In currency markets, China’s yuan took a beating and there was a flight to the safe-haven Japanese yen and to the Swiss franc, which held just under a one-month high on Wednesday.
However the trade-exposed Australian and New Zealand dollars mostly held on to gains won against the greenback after disappointing manufacturing data weakened the US currency on Monday.
The dollar last traded for 108.65 yen, while a euro bought $1.1081 and the Aussie $0.6850.
Gold was steady at $1,477.20 per ounce.
US West Texas Intermediate (WTI) crude steadied to gain 0.61% to $56.44 per barrel, after sliding following Trump’s comments.
(Reuters contributed to the story)