Gold – RBI policy statement to drive Indian markets today; banks, auto stocks in focus
MUM(BA)I: Indian stock markets on Friday will likely take their cues from the Reserve Bank of India’s monetary policy statement, due at 10am. The SGX Nifty futures, however, suggest a positive start for domestic benchmark indices.
On Thursday, the BSE Sensex ended at 50,614.29, up 358.54 points or 0.71%. The Nifty closed at 14,895.65, up 105.70 points or 0.71%. The market cap of all listed stocks on the BSE hit ₹200 trillion for first time ever.
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With the Reserve Bank of India’s (RBI) monetary policy committee expected to maintain status quo on benchmark rates on Friday, the focus will shift to how the central bank intends to lend liquidity support to the government’s massive borrowing plan.
Rate sensitive stocks like banks and automobile companies will be in focus as a change in interest rates or policy stance by the central bank will impact consumer sentiment.
Top companies which will announce their December quarter earnings today are M&M, Pfizer, Punjab National Bank, Alkem Laboratories, Ashoka Buildcon, Britannia, Cadila Healthcare, Fortis Healthcare, GlaxoSmithkline Pharma and Gujarat Gas.
Hero MotoCorp Ltd – country’s largest two-wheeler manufacturer – on Thursday reported a 23.2% year-on-year increase in net profit to ₹1,084 crore for the quarter ended December, as sales of its motorcycles and scooters. Net profit was also higher than the Rs953.4 crore reported in the September quarter.
Asian markets were firm after progress in vaccine distribution and a large US stimulus program sent two major Wall Street indexes to record closing highs.
Wall Street rallied for a fourth consecutive day on Thursday as Democrats pushed ahead with US President Joe Biden‘s proposed $1.9 trillion stimulus plan without bipartisan support. Some investors expected the Department of Labor to release better-than-expected jobs data later on Friday.
Each of the major Wall Street indexes rose more than 1% on Thursday. The Nasdaq Composite Index and S&P 500 set record highs.
Bullish sentiment around stimulus and the broader US economic recovery also pushed longer-term Treasury yields higher and strengthened the dollar.
The benchmark 10-year yield rose about 1 basis point to 1.1409% as investors positioned for a large pandemic relief package. The 20-year U.S. Treasury yield rose 2 basis points to 1.7396%.
The U.S. dollar index rose 0.5% as the euro weakened.
Strength in the dollar limited gains in oil markets which continued their upswing as promised supply cuts mean inventories were likely to stay low.
U.S. crude recently rose 0.52% to $56.52 per barrel and Brent was at $59.11, up 1.11% on the day.
Spot gold added 0.2%, at $1,795.30 an ounce, and U.S. gold futures % to $1,788.90 an ounce.
(Reuters contributed to the story)
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Gold – RBI policy statement to drive Indian markets today; banks, auto stocks in focus
