Indian stock market on Budget 2024 day: 6 key things that changed for market overnight – Gift Nifty to US Fed policy

Indian stock market: The Indian stock market is expected to open on a cautious note on Thursday ahead of the announcement of Union Budget 2024 today and amid weak global market cues.

Asian markets traded mixed, while the US stocks ended lower overnight after the US Federal Reserve policy meet outcome.

The US Fed left its key policy rate unchanged at 5.25%-5.50% against a backdrop of gradually cooling inflation and a resilient economy, but pushed back against expectations for a rate cut in March.

Catch Live Stock Market Updates here

On Wednesday, the Indian benchmark indices posted healthy gains ahead of the Interim Budget 2024.

The Sensex jumped 612.21 points, or 0.86%, to close at 71,752.11, while the Nifty 50 settled 203.60 points, or 0.95%, higher at 21,725.70.

Global markets reacted to the US Fed’s commentary on the rate cut timeline. On the domestic front, focus will remain on the Budget announcements.

“While the Interim Budget is non-event, the general expectations are minimal in terms of major proposals. Given that India’s economic growth has been strong in the last 2 years, the government could focus on fiscal consolidation and could set a fiscal deficit target of around 5.2% – 5.4% of GDP. Since it is colliding with the US Fed outcome we expect the market to see some volatility. However, the overall trend continues to remain positive,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd.

Also Read: Buy or sell on Budget 2024 date: Vaishali Parekh recommends three stocks to buy today — February 1

Here are key domestic and global market cues for Sensex today:

Asian Markets

Asian markets traded mixed tracking overnight losses on Wall Street after the US Federal Reserve signaled that it was unlikely to cut interest rates in March.

Japan’s Nikkei 225 declined 0.5%, while the Topix rose 0.4%. South Korea’s Kospi gained 0.5% and the Kosdaq was flat. Hong Kong’s Hang Seng index futures indicated a stronger opening.

Gift Nifty

Gift Nifty was trading around 21,800 level, as compared with Nifty futures’ previous close of 21,786, indicating a mildly positive start for the Indian stock market indices.

Wall Street

The US stock market indices ended sharply lower on Wednesday, with the S&P 500 recording its steepest daily loss since September 21, after the Federal Reserve kept interest rates unchanged while dashing hopes for rate cut as soon as March.

The Dow Jones Industrial Average declined 317.01 points, or 0.82%, to 38,150.30, while the S&P 500 dropped 79.32 points, or 1.61%, to close at 4,845.65. The Nasdaq Composite ended 345.88 points, or 2.23%, lower at 15,164.01.

Among stocks, Alphabet shares plunged 7.5% after disappointing Q4 earnings. New York Community Bancorp shares tanked 37.7%, touching their lowest level in over two decades after posting a surprise loss and slashing its dividend.

(Exciting news! Mint is now on WhatsApp Channels Subscribe today by clicking the link and stay updated with the latest financial insights! Click here!)

US Federal Reserve

The US Federal Reserve on Wednesday decided to keep interest rates unchanged for the fourth straight meeting. The Federal Open Market Committee (FOMC) unanimously voted to hold the policy rate at the 23-year high, in the range of 5.25% – 5.50%.

In its statement, the Federal Open Markets Committee (FOMC) said it “does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%,” disappointing investors who hoped for a quick dovish pivot.

Read here: US Federal Reserve keeps rates unchanged: 10 key highlights from Jerome Powell-led FOMC meeting

GST Collections

The gross GST revenue collected in the month of January 2024, is ₹172,129 crore, which shows a 10.4% year-on-year (YoY) growth over the revenue of ₹155,922 crore collected in January 2023, Finance Ministry said.

Japan factory activity shrinks

Japan’s factory activity shrank for an eighth straight month in January as output and new orders declined. The final au Jibun Bank Japan manufacturing purchasing managers’ index (PMI) rose to 48.0 in January from 47.9 in December, but remained below the 50.0 threshold that separates growth from contraction in activity, where it has languished since June, Reuters reported.

(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.