Stock Market Cues: US Air Strikes ISIS, Japan Inflation, Crude Oil, Gold, Silver And More

Stock Market Cues: Domestic equity markets, as well as major global exchanges, were closed on December 25 for Christmas. Some global markets are shut even on December 26, on account of post-Christmas holiday. This suggests that trading volumes are likely to be thin today.

In the previous session on December 24, domestic benchmark indices closed near their intra-day lows. The Sensex settled at 85,408.70, down 116.14 points or 0.14 per cent, and the Nifty 50 ended at 26,142.10, down 35.05 points or 0.13 per cent.

As trading resumes on December 26, market participants are expected to react to fresh geopolitical developments, key economic data from Japan, fluctuations in crude oil prices, and the rupee-dollar exchange rate, among other cues.

Stock Market Cues To Watch On Dec 26

Following are the key share market cues that are likely to influence investor sentiment in trade on December 26:

US Stock Market

US stock market, too, was shut on December 25 on account of Christmas. On December 24, Wall Street's benchmark indices closed higher, led by revival of AI trade after last week's selloff occurred due to concerns over stretched valuations of these counters.

At close, Dow Jones was up 0.60 per cent, S&P 500 was up by 0.32 per cent and the tech-heavy Nasdaq Composite was up 0.22 per cent. 

Asian Stock Markets

Asian markets were trading higher on December 26 morning. Japan led the early gains, as Nikkei 225 traded around 1 per cent higher, hovering around its two-week high. The broader Topix touched a fresh record high, trading higher by around 0.50 per cent.

South Korea's Kospi was up by 0.70 per cent, and China's blue-chip CSI 300 traded up by 0.60 per cent. Hong Kong's Hang Seng is shut today on account of post-Christmas holiday. Australian, Canadian and most of the European markets are also closed today.

Japan’s Core Inflation Data

Core consumer inflation in Japan slowed in December as food price pressures eased, but it stayed above the Bank of Japan’s 2 per cent target, data released earlier today showed, keeping the case for further interest rate hikes intact.

"The data backs up the Bank of Japan's (BoJ) view that core inflation will slide below its 2 per cent target in coming months on easing cost pressure, before resuming a more demand-led increase that justifies additional rate increases. But some analysts warn of the risk renewed yen declines may prod firms to keep raising prices, leading to sticky, cost-led inflation that could quicken the pace of BOJ rate hikes," Singapore-based Channel News Asia said in a report.

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US-Venezuela Oil Tensions

The White House has asked US forces to largely prioritise enforcing a “quarantine” on Venezuelan oil shipments for the next two months, signalling that Washington is leaning more on economic pressure rather than military action to pressurise Venezuela, a US official told Reuters.

The announcement comes after recent US operations in Venezuela resulted in at least 105 deaths.

US Air Strikes ISIS In Nigeria

The US carried out an airstrike against ISIS terrorists in northwest Nigeria, US President Donald Trump announced on the eve of Christmas.

“Tonight, ‌at my direction as Commander in Chief, the United States launched a powerful and deadly strike ‌against ISIS Terrorist Scum in Northwest Nigeria,” Trump wrote on his Truth Social platform. “I have previously warned these Terrorists that if they did not stop the slaughtering of Christians, there would be hell to pay, and tonight, there was.”

The strike comes weeks after Trump directed the Pentagon to prepare for potential military action in Nigeria amid reports of Christian persecution.

Crude Oil Prices Today

Crude oil prices traded higher in early trade on December 26 amid supply concerns after US’ tightening of economic pressure on Venezuelan oil shipments and US forces’ air strikes on Islamic State militants in Nigeria.

Brent crude oil futures surged as much as 0.40 per cent to hit the day's high at $62.49 a barrel, while the West Texas Intermediate (WTI) crude oil futures climbed up to 0.41 per cent to touch the day's high at $58.59 per barrel.

Gold And Silver Prices Today

Gold and Silver prices hit fresh record highs in early trade on December 26, amid fresh geopolitical tensions, weaker US dollar and expectations of further interest rate cuts by the US Federal Reserve.

February Gold futures on the Multi Commodity Exchange (MCX) advanced up to 0.86 per cent to hit a new lifetime high of Rs 1,39,285 per 10 grams. March Silver futures on MCX jumped as high as 4 per cent to hit a new record high of Rs 2,32,741 per kg.

Rupee Vs US Dollar

The Indian rupee opened at 89.67 against the US dollar on December 26 and has traded largely flat so far, oscillating between an intraday high of 89.85 and a low of 89.56. Foreign fund outflows, rising crude oil prices, and uncertainty around the potential India-US trade kept the sentiment muted.