The BSE Sensex and NSE Nifty are likely to open in deep red on Tuesday tracking SGX Nifty and weak global cues. Interest sensitive stocks are likely to be in focus ahead of the Reserve Bank of India’s (RBI) monetary policy review, which is scheduled around at 11 am. The RBI had kept its benchmark lending rate – the repo rate unchanged at 7.25 per cent in its monetary policy review on August 4.
At 8.22 am (IST), SGX Nifty was down 1.50 per cent, or 115.50 points, at 7,717.50.
Achin Goel, head, wealth management and financial planning, Bonanza Portfolio, said, “Outcome of RBI’s monetary policy meet on Tuesday will decide the trend of the markets in the near term.”
Asian shares skidded to three-week lows and the dollar sagged on Tuesday, after weak Chinese data rekindled worries about its fragile economy and led to sharp losses on Wall Street.
Hang Seng, Nikkei and Shanghai were down 3.48 per cent, 2.77 per cent and 1.35 per cent at 20,448, 17,156 and 3,057, respectively.
Chinese industrial companies’ profits fell at their fastest rate in four years, official data showed on Monday, sparking fresh fears about the strength of that country’s economy ahead the final reading of China’s Caixin Purchasing Managers’ Index on Thursday.
On Wall Street on Monday, all major indices closed in red. The S&P 500 index hit a one-month low on bullish US consumer spending data in August as it raised concerns the Federal Reserve could hike rates at a time of slackening global growth.
Back home, Sensex closed 246.66 points down at 25,616.84 on Monday while Nifty closed 72.80 points down at 7,795.70.
Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services, said, “We are in a wait and watch scenario ahead the RBI policy meet on Tuesday. We believe that the market has already considered a rate cut of 25 basis points, hence the commentary will be more important. Given the volatility in the global currency and the likelihood of a US rate hike by Dec-15, the commentary is likely to be hawkish and may not be taken positively by the market.”
(With inputs from agencies)
First Published on September 29, 2015 8:49 am © The Indian Express Online Media Pvt Ltd