FX.co ★ Sensex, Nifty Seen Higher At Open As Fed Rate-cut Hopes Revive

Indian stocks are poised for an optimistic start on Tuesday, buoyed by the S&P 500 and Nasdaq Composite reaching new record highs overnight.

The possibility of a rate cut could enhance investor sentiment, following comments from Federal Reserve Governor Christopher Waller, who expressed a preference towards a December rate cut but remains vigilant about slow inflation progress.

Domestically, the Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) is set to convene from December 4 to 6. Economists widely anticipate that the repo rate will remain unchanged for the eleventh consecutive session.

The Sensex and Nifty indices advanced approximately 0.6% each on Monday, marking gains for the second day in a row, even though second-quarter GDP figures were below expectations.

Experts predict a fiscal recovery in the latter half of the year, fueled by increased government spending, the ongoing festive season, and strong rural consumption.

The Indian rupee depreciated by 21 paise, closing at a new record low of 84.70 against the U.S. dollar on Monday. This slump followed U.S. President-elect Donald Trump's threat to levy 100% tariffs on BRICS countries moving away from the U.S. dollar.

Asian markets presented a mixed picture this morning, as investors prepared for a slew of U.S. economic data and insights from Federal Reserve officials that could offer further guidance on interest rate directions.

The dollar gained traction as the euro and yuan weakened amid fears of a potential governmental collapse in France and apprehensions regarding Trump’s tariff threats.

Gold remained relatively stable after a near 1% decline on Monday, while oil prices fell slightly ahead of the scheduled OPEC+ meeting on Thursday.

On Wall Street, technology-related stocks performed well leading up to a week brimming with economic data releases, including reports on private and non-farm payrolls, Job Openings and Labor Turnover Survey (JOLTS), and manufacturing activity.

Recent data indicated an improvement in U.S. manufacturing activity in November, yet it still pointed towards contraction.

The S&P 500 edged up by 0.2%, with the technology-centric Nasdaq Composite surging 1% to new closing records. Meanwhile, the Dow Jones Industrial Average slipped 0.3%.

In Europe, stocks closed higher on Monday after France's government made a last-minute concession to Marine Le Pen regarding the 2025 budget, alleviating some political tensions.

The pan-European STOXX 600 index rose by 0.7%, with Germany's DAX surging 1.6%. France's CAC 40 ended slightly higher, and the U.K.'s FTSE 100 increased by 0.3%.