FX.co ★ Sensex, Nifty To Follow Global Peers Higher As Fed Signals Rate Cut

Indian shares are poised for a higher opening on Thursday, influenced by positive signals from global markets, following the U.S. Federal Reserve's indications of a potential interest rate cut—a move that investors have eagerly anticipated.

On the earnings front, key companies such as Coal India, Maruti Suzuki India, Tata Steel, and Adani Power released their quarterly results after market hours on Wednesday. Today, ITC, Sun Pharmaceutical Industries, Tata Motors, Zomato, Adani Enterprises, and Adani Ports and Special Economic Zone are scheduled to announce their financial outcomes.

Activity in oil and gas stocks may spike today due to a rise in international crude oil prices and the Indian government’s reduction of the windfall tax on domestically produced crude oil from Rs 7,000 per ton to Rs 4,600 per ton.

On Wednesday, benchmark indices Sensex and Nifty posted modest gains, while the rupee ended flat after hitting a record low of 83.74 against the dollar earlier in the day.

This morning, Asian markets generally traded higher, although Japan's Nikkei index dropped more than 3 percent as the yen continued its significant rally, reaching a 4-1/2-month high, thereby complicating the outlook for the country's exporters. Meanwhile, a private survey revealed an unexpected contraction in China’s manufacturing sector in July, suggesting the need for stronger economic stimulus.

In currency markets, the dollar experienced losses during Asian trading, gold remained stable near a two-week high, and oil prices continued their upward trajectory after a 4 percent surge in the previous session. This spike followed the killing of a Hamas leader in Iran, which heightened fears of a broader Middle East conflict.

U.S. stocks saw a rally overnight as comments from Fed Chair Jerome Powell, combined with positive earnings reports from companies such as AMD, Starbucks, and DuPont, buoyed investor sentiment. Despite keeping the key interest rate at a 23-year high, Powell stated that recent progress in controlling inflation and cooling labor market conditions might open the door for a rate cut in September.

Technology stocks propelled the tech-heavy Nasdaq Composite to a 2.6 percent increase, driven by gains in Meta and Nvidia. The S&P 500 rose by 1.6 percent, marking its best daily performance since February, while the Dow Jones Industrial Average marginally increased by 0.2 percent.

In Europe, stocks extended gains for a second consecutive session on Wednesday, with robust corporate earnings offsetting data that revealed an unexpected rise in Eurozone inflation for July. The pan-European STOXX 600 index advanced by 0.8 percent, Germany's DAX increased by 0.5 percent, France's CAC 40 rose 0.8 percent, and the U.K.'s FTSE 100 climbed by 1.1 percent.