Indian shares are likely to open weak on Friday, tracking sluggish Asian equities after US stocks fell to a three-week low amid the surge in bond yields.
The BSE Sensex and NSE’s Nifty 50 plunged over 2 percent on Thursday following a massive selloff in oil refiners after the government asked the companies to absorb Rs 1 cut on fuel prices.
Investors now switch their focus to the Reserve Bank of India monetary policy decision later in the day. A majority of the economists in CNBC-TV18’s MPC have asked for a rate hike looking at the sheer plunge in rupee.
Here is what you need to know before the market opens:
Asia: MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.3 percent, while Japan’s Nikkei dropped 0.5 percent and Australian benchmark was up just 0.1 percent.
US: The Dow Jones Industrial Average fell 200.91 points, or 0.75 percent, to 26,627.48, the S&P 500 lost 23.9 points, or 0.82 percent, to 2,901.61 and the Nasdaq Composite dropped 145.58 points, or 1.81 percent, to 7,879.51.
SGX Nifty: At 06.50 AM, SGX Nifty, an early indicator of the Nifty 50's trend in India, plunged 0.61 percent to 10,539.50, indicating a weaker opening for the Indian market today.
Crude oil prices: International benchmark Brent crude oil futures were at $84.94 per barrel at 0008 GMT, up 36 cents, or 0.4 percent from their last close. US West Texas Intermediate (WTI) crude futures were up 41 cents, or 0.6 percent, at $77.74 a barrel.
Market at close on Thursday: Indian shares plummeted over two percent on Thursday, amid sustained selling across all sectors.Benchmark indexes were particularly dragged lower by oil and energy stocks towards the end as the centre announced excise cut. The BSE Sensex closed down 2.24 percent at 35,169.16, while the NSE Nifty 50 ended 2.39 percent lower at 10,599.25, in its biggest percentage fall since November 11, 2016.
Rupee: The Indian rupee closed at 73.58 against the US dollar on Thursday, after hitting a historic low of 73.70 earlier in the day as concerns over rising crude oil prices and steady fund outflows hampered risk appetite.
Excise Duty Cut On Fuel Prices: In a major relief for consumers, the government on Thursday reduced excise duty on petrol and diesel by Rs 1.50 per litre and said the oil marketing companies (OMC) will absorb the impact to the tune of Re 1 per litre. The consumers will get a benefit of Rs.2.50, said finance minister Arun Jaitley while announcing the decision.
Fuel Prices: After reaching historic levels on Thursday, fuel prices fell across all major cities today, with petrol down by Rs 4.37 to Rs 86.97 a litre while diesel prices lost Rs 2.65 to Rs 77.45 a litre in Mumbai.
RBI Policy: The Reserve Bank of India (RBI) will probably raise interest rates by a quarter of a percentage point on Friday and provide guidance on curbing rupee's fall. The predicted rate hike would be the RBI’s third this year, after it lifted borrowing costs in June and August.
Russia’s Putin in India: Russian President Vladimir Putin arrived in New Delhi on a two-day visit to hold the annual bilateral summit with Prime Minister Narendra Modi. The focus during the visit will be on the S-400 Triumf air defence missile system agreement, with a top Kremlin aide saying Tuesday that Russian President Putin will oversee the signing of the $5 billion deal.
(With inputs from agencies)
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