Indian shares are poised to open on a weak note on Thursday, as investors await the January-March quarter GDP data for directional cues. The GDP figures due to be announced today will probably show that growth held steady in the fourth quarter at around 6 percent amid the global economic slowdown and weak investment demand domestically.
The rupee's movement is crucial as a stronger rupee coupled with falling crude prices will certainly help improve the nation's widening fiscal and current-account deficits. Trading will likely remain volatile due to impending F&O expiry.
Indian shares fell notably on Wednesday, with benchmark indexes Sensex and the broader Nifty falling about 0.8 percent each, weighed down by concerns about Spain's banking system and news that China has no plans to introduce large-scale stimulus measures. The Indian rupee fell below the psychologically important level of 56 against the dollar once again, further dampening investor sentiment.
Asian markets
Asian markets are trading lower across the board, with key benchmark indexes in China, Australia, Hong Kong, Japan, South Korea falling between 0.7 percent and 1.8 percent, as disappointing U.S. pending home sales data and weak Japanese industrial output data added to concerns about the global economy.
U.S. and European markets
U.S. stocks tumbled overnight, with concerns over rising Italian and Spanish bond yields and data showing an unexpected decline in U.S. pending home sales last month contributing to the sharp pullback by the markets. The Dow slid 1.3 percent, the tech-heavy Nasdaq fell 1.2 percent and the S&P 500 lost 1.4 percent.
A report from the National Association of Realtors showed that pending home sales unexpectedly saw a notable decrease in April, with the headline index tumbling 5.5 percent to 95.5 in April after rising 3.8 percent to a downwardly revised 101.1 in March. The drop by the index surprised economists, who had expected pending home sales to edge up by 0.5 percent.
Major European markets also ended sharply lower, with France's CAC 40, the U.K.'s FTSE 100 and the German DAX all falling around 2 percent each after a new opinion poll showed Greece's radical leftist Syriza party has taken the lead over the pro-bailout conservatives.
Crude
U.S. crude oil futures settled at a seven-month low on Wednesday, as increasing worries that the debt contagion could spread from Greece to Spain and Italy boosted the dollar. Oil prices were also impacted after media reports indicated that China may not match the stimulus efforts of 2008, with a much lower spending this time around.
Crude futures for July delivery dropped $2.94 or 3.2 percent to close at $87.82 a barrel on the New York Mercantile Exchange, the lowest settlement since October 21,2011.
by RTT Staff Writer
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