FX.co ★ Sensex, Nifty To Open On Cautious Note As Investors Await RBI Rate Decision

Indian stock markets are expected to open cautiously on Friday, as investors anticipate the Reserve Bank of India's (RBI) monetary policy decision scheduled for later in the day, seeking guidance on future trends.

In light of recent concerning reports on headline inflation and gross domestic product (GDP), experts are split on whether the rate-setting committee will maintain its current interest rates or announce a policy reduction for the first time since February 2023.

While foreign institutional investors (FIIs) have resumed purchasing, any potential market losses are anticipated to be minimal.

In a separate development, the Maharashtra government has declared today a local holiday in observance of the death anniversary of Bharat Ratna Dr. B.R. Ambedkar, known nationwide as Mahaparinirvan Diwas. However, stock exchanges BSE and NSE have not announced a holiday closure.

On Thursday, benchmark indices Sensex and Nifty each advanced approximately 1%, marking gains for the fifth consecutive day, with IT stocks leading the rise. The Indian rupee appreciated by 3 paise, closing at 84.72 against the U.S. dollar, rebounding from a record low.

In Asia, markets were subdued this morning in cautious trading, ahead of the U.S. jobs report expected later today, which could influence the Federal Reserve's policy decisions for the month.

The U.S. dollar showed weakness, Treasury yields remained stable, and gold prices drifted lower, nearing $2,600 per ounce.

Oil prices decreased following the OPEC+ group's decision to delay planned supply increases and extend significant output cuts until the end of 2026.

In the U.S., stocks experienced volatility before closing lower overnight. The S&P 500 and the Nasdaq Composite, focused on technology stocks, both dipped around 0.2% after hitting new intraday highs. The Dow Jones Industrial Average fell 0.6%, influenced by a decline in United Health Group shares, following the tragic incident involving CEO Brian Thompson outside a Manhattan hotel.

Meanwhile, European stocks achieved a sixth consecutive day of gains on Thursday, marking the longest winning streak since May, driven by optimism over the potential passage of a new budget within the coming weeks.

The pan-European STOXX 600 index rose by 0.4%. Germany's DAX increased by 0.6%, France's CAC 40 went up by 0.4%, and the U.K.'s FTSE 100 saw a modest rise of 0.2%.