Key Market Cues Likely To Influence D-Street Action In Today's Trade

In the previous session, domestic equities extended gain for the fourth day in a row, amid weekly Nifty futures and options (F&O) expiry. However, the gain showed a lack of momentum, as benchmark indices ended the session off their day’s highs amid profit booking in select heavyweight stocks.

At close, Sensex was at 81,926.75, up 136.63 points, or 0.17 per cent, and Nifty 50 was at 25,108.30, up 30.65 points, or 0.12 per cent.

Key Market Cues To Watch Today

In trade on October 8, a host of global market cues are likely to impact action on the Dalal Street. Here’s a look at these:

US Market Closes Lower

Equities in the US closed broadly lower overnight as investors grew cautious over political uncertainty in France, Japan and amid the ongoing US government shutdown.

As a result, the Dow Jones fell 0.20 per cent, the S&P 500 slipped 0.38 per cent, and the Nasdaq declined 0.67 per cent.

The US government today entered its seventh day of shut down, which began after Congress failed to reach on a funding deal before the October 1 deadline. This is the first shutdown in President Donald Trump’s second term. The fight is mainly over healthcare subsidies and budget priorities. Republicans want temporary funding while Democrats ask for a broader agreement. About 7,50,000 federal workers are affected, and many non-essential government services are on hold.

The shutdown adds fresh uncertainty to the already nervous global markets, and is prompting investors to seek safe haven assets like gold and bonds.

Asian Markets Trade Mixed

Asian equities traded mixed in early trade today. Japan's Nikkei 225 gained up to 0.40 per cent, while the Hong Kong-based Hang Seng slipped as much as 1.21 per cent.

Crude Oil Price Today

Crude oil prices gained in early trade today. The Brent crude oil futures jumped 0.86 per cent to $65.97 per barrel. The WTI crude oil futures gained 0.87 per cent to $62.27 per barrel.

Gold Price Today

Gold prices surged amid fresh uncertainties in the global market.

Gold price on the Multi Commodity Exchange (MCX) jumped 0.65 per cent to Rs 1,21,902 per 10 grams. In the international market, COMEX Gold futures jumped 0.72 per cent to $4,033.10 per ounce.

Bond Yields

India's benchmark 10-year Bond Yield slipped 5 basis points (pbs) to 6.50 per cent today. Over the last week, the benchmark yield tumbled over 1 per cent, largely due to lower-than-expected state borrowing, which reduced the supply of bonds in the market, pushing prices up and yields down.

US’ benchmark 10-year Treasury Yield rose 2 bps to 4.13 per cent today, reversing part of the previous session’s 84-bps fall. Since last week, when the US government shutdown began, the yield has surged more than 230 basis points. This is largely because investors are seeking save haven assets amid US government shutdown.

USD vs INR

The Indian Rupee (INR) opened higher but remained under pressure from a strengthening US dollar (USD) in early trade today. INR slipped 5 paise to trade at 88.76 against the USD.

Meanwhile, the US dollar index futures, which measures the greenback against six major currencies, rose 0.34 per cent in early trade to quote at 98.62, gaining 0.34 points.

The US government shutdown has increased demand for the USD as a safe haven investment. Expectations of a possible US Federal Reserve rate cut later this month have also strengthened the currency.

UK PM Keir Starmer India Visit

UK Prime Minister Keir Starmer arrived in Mumbai early today for a two-day visit, leading a 125-member delegation of CEOs, academics, and industry representatives. The visit comes months after the signing of India-UK Free Trade Agreement (FTA) during Prime Minister Narendra Modi’s visit to the UK in July, and also comes amid India’s deadlock with US over tariffs deal.

Starmer is set to meet PM Modi at Raj Bhavan on October 9 to issue a joint communique on bilateral ties, meet key industry leaders over lunch, and attend the Global Fintech Fest at Jio World Centre.

FOMC Meeting Minutes

After the US Federal Reserve's 25-basis-point rate cut announcement following its September 16-17 meeting, the American central bank is set to release its rate-setting panel Federal Open Market Committee's (FOMC) meeting's minutes at 2 PM ET (11:30 PM IST).

Market participants will closely watch the minutes for clues on the US Fed’s future rate trajectory and to gauge the central bank's assessment of economic risks amid tariffs and the H-1B visa fee hike. The American central bank has already indicated that there will be two more rate cuts by the end of this calendar year.