Indian stock market: 10 key things that changed for market overnight - Gift Nifty, Wall Street sell-off to BoE rate cut

Indian stock market: The domestic equity market indices, Sensex and Nifty 50, are expected to open lower on Friday following a sharp sell-off in global markets.

Asian markets traded lower, while the US stock market plunged overnight after weak economic data raised concerns over slowdown and stoked recession fears.

On Thursday, the Indian stock market benchmark indices ended at fresh closing highs, marking their fifth consecutive session of gains, with the Nifty 50 settling above the 25,000 level.

The Sensex gained 126.21 points, or 0.15%, to close at 81,867.55, while the Nifty 50 settled 59.75 points, or 0.24%, higher at 25,010.90.

“While the valuations of Indian markets continue to remain high, fund flows could help Nifty head even higher with some intermittent corrections. Retail investors would do well to rebalance their asset allocation and cut equity portion in case it has exceeded the planned allocation. They could also look at taking part profits out of stocks that have run up sharply over the last few months – much ahead of the justified valuations,” said Deepak Jasani, Head of Retail Research, HDFC Securities.

Amar Deo Singh, Sr. Vice President of Research, Angel One Ltd believes investors need to be selective in their investment approach at such elevated levels, and should look at investing in quality names, in a staggered manner, with a long-term investment perspective.

Here are key global market cues for Sensex today:

Asian Markets

Asian markets plunged on Friday following overnight sell-off on Wall Street.

Japan’s Nikkei 225 tanked almost 5%, while the Topix plunged more than 5%. South Korea’s Kospi fell 2.6%, and the Kosdaq declined 2.56%. Hong Kong’s Hang Seng index futures indicated a lower opening.

Gift Nifty Today

Gift Nifty was trading around 24,820 level, a discount of nearly 215 points from the Nifty futures’ previous close, indicating a gap-down start for the Indian stock market indices.

Wall Street

US stock market ended sharply lower on Thursday amid concerns over a slowing economy.

The Dow Jones Industrial Average declined 494.82 points, or 1.21%, to 40,347.97, while the S&P 500 dropped 75.62 points, or 1.37%, to 5,446.68. The Nasdaq Composite closed 405.25 points, or 2.30%, lower at 17,194.15.

Meta shares rallied 5.87% higher, while Amazon share price fell 4.47%. Nvidia stock price dropped 6.67%, while ARM shares plummeted 15.72% and Qualcomm stock price stumbled 9.37%. Moderna shares tanked 21.01%, while Eli Lilly shares rose 3.5%.

Bank of England

The Bank of England on Thursday delivered its first interest rate cut since March 2020. The BoE slashed interest rates by 25 basis points (bps) to 5% from a 16-year high of 5.25% held since August 2023. Bank of England Governor Andrew Bailey said the central bank would move cautiously going forward.

US Manufacturing PMI

A measure of US manufacturing activity dropped to an eight-month low in July amid a slump in new orders. The Institute for Supply Management (ISM) said its manufacturing PMI dropped to 46.8 last month, the lowest reading since November, from 48.5 in June. Economists polled by Reuters had forecast the PMI rising to 48.8.

Initial Jobless Claims

The number of Americans filing new applications for unemployment benefits increased to an 11-month high last week. Initial claims for state unemployment benefits increased 14,000 to a seasonally adjusted 249,000 for the week ended July 27, the highest level since August last year. Economists polled by Reuters had forecast 236,000 claims for the latest week.

GST Collections

Goods and Services Tax (GST) collections stood at ₹1.82 lakh crore in July, marking an increase of 10.3% year-on-year (YoY). GST receipts also rose compared to the ₹1.74 lakh crore collected in June 2024.

US Treasury Yields

US Treasury yields tumbled on soft economic data, with the two-year to 10-year note yields dropping to six-month lows, below 4%, while those on 20-year and 30-year bonds slid to their weakest level since March, Reuters reported. The benchmark US 10-year Treasury yields plunged as much as 14 basis points to a six-month low of 3.965%.

Oil Prices

Crude oil prices traded higher but were set for a fourth weekly decline amid signs of disappointing global fuel demand growth.

Brent crude futures gained 0.4% to $79.85 a barrel, after falling 1.5% in the previous session, while US West Texas Intermediate crude futures rose 0.5% to $76.69, after a 2.1% drop on Thursday.

Currencies

Japanese yen and Swiss franc traded near multi-month highs against the dollar. The yen traded around 0.2% stronger at 149.085 per dollar and the franc edged to its highest since early February at 0.8726 per dollar, Reuters reported. Sterling slipped 0.09% to $1.2723, while the euro declined 0.07% to $1.07845.

(With inputs from Reuters)

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