Indian stock markets are poised to open slightly higher on Friday, drawing strength from positive global market trends. However, volatility remains a possibility due to concerns surrounding the policies of former U.S. President Donald Trump and caution ahead of earnings reports from major companies like SBI, LIC, and Tata Motors.
On Thursday, key indices Sensex and Nifty dropped over 1% each as foreign funds continued to flow out. The Indian rupee weakened, declining by 6 paise to conclude at a new record low of 84.37 against the U.S. dollar.
This morning, Asian stocks advanced as investors awaited insights into China's economic stimulus measures. The dollar stabilized following a tumultuous week, while U.S. Treasury yields edged lower after a surge during the American trading session.
Gold prices fell below $2,700 per ounce, reversing more than a 1% gain from the earlier session, after Fed Chair Jerome Powell indicated that the Federal Reserve would assess data to adjust the pace and target of interest rates.
Oil prices experienced a minor decline but remain set for a weekly increase.
In the U.S., stock markets closed with gains overnight, while Treasury yields and the dollar fell post the Fed's 25-basis point interest-rate cut. The Federal Reserve indicated ongoing reductions, with no intention to pause rate cuts.
Fed Chair Powell emphasized that interest rates are not on a "preset course" and future decisions will be approached on a "meeting by meeting" basis to address risks associated with the Fed's dual mandate.
Investors are also bracing for a potential "Trump 2.0 era" and an "America First" economic policy, amid concerns regarding the impact of proposed tariff hikes on inflation and interest rates.
The tech-centric Nasdaq Composite rose by 1.5%, the S&P 500 gained 0.7% marking a second consecutive record close, while the Dow settled with a slight decline.
European stocks recouped losses on Thursday, driven by gains in technology and resource sectors, following the Bank of England’s expected interest rate cut and its caution regarding gradual future cuts.
The pan-European STOXX 600 increased by 0.6%. Germany's DAX surged 1.7%, France's CAC 40 rose 0.8%, whereas the U.K.'s FTSE 100 fell by 0.3%.