Indian stocks are expected to open higher on Wednesday, with benchmarks getting closer to their all-time highs. This is because it is becoming more likely that the U.S. Federal Reserve will stop raising interest rates after inflation dropped to its lowest level in more than two years in May.
As of 7:49 a.m. IST, India’s NSE stock futures on the Singapore Exchange were up 0.27% to 18,835.
Tuesday was a good day for stocks on Wall Street. Both the Nasdaq and the S&P 500 hit new highs for the year. In May, the annual rise in the consumer price index was the smallest it had been in more than two years. The chances of a Fed rate pause went from 75% before the data to 93.7% after the data.
Before the Fed’s policy decision on Wednesday at 11:30 p.m. IST, Asian markets went up by a small amount.
Tuesday was a good day for risky investments because inflation in India went down. Both the Nifty 50 and the Sensex finished at their highest levels in six months, and they are less than 1% away from their all-time highs.
The midcap index went up by more than 1.2%, reaching a new all-time high. A new 52-week high was also reached by the small-cap index.
Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services, said, “Lower domestic inflation helped fast-moving consumer goods stocks, and the RBI’s (Reserve Bank of India) pausing rate hikes last week helped real estate stocks.”
Before the Fed, the Bank of Japan, and the European Central Bank make significant central bank decisions, analysts believe that the markets will calm down.
According to preliminary NSE data, foreign institutional investors bought 16.78 billion rupees ($204 million) worth of Indian stocks on Tuesday, while local buyers sold 2.03 billion rupees worth of shares.
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