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Sensex, Nifty Set To Open Higher On Fed Rate Cut Optimism

Indian shares may open higher on Thursday, mirroring firm cues from Wall Street and Asia as comments by Federal Reserve Chairman Jerome Powell signaled a rate cut later this month.

However, an overnight rally in oil prices and concerns over lower-than-expected earnings for the June quarter may limit the downside to some extent.

West Texas Intermediate Crude oil futures for August delivery extended gains in Asian trading after climbing 4.5 percent to a seven-week high of $60.43 a barrel on Wednesday, as data showing a continued draw-down in U.S. crude inventories and the possibilities of a tropical disturbance becoming a storm alleviated concerns about oversupply.

Benchmark Brent crude futures for September delivery gained 4.4 percent to end at 67.01 dollars a barrel on the London ICE Futures Exchange, the highest finish since May 29.

Closer home, benchmark indexes Sensex and the Nifty ended down around half a percent on Wednesday while the rupee slipped 7 paise to close at 68.58 against the greenback.

Asian stocks rose this morning while the U.S. dollar sagged, helping lift gold prices to their highest level in over a week.

U.S. stocks ended higher overnight after Fed Chair Jerome Powell strongly hinted at a potential rate cut later this month and the June FOMC minutes showed increasing support for lowering rates amid increased economic uncertainties and muted inflation pressures.

The Dow rose 0.3 percent and the S&P 500 index briefly crossed the 3,000-point mark for the first time before closing half a percent higher, while the tech-heavy Nasdaq gained 0.8 percent to hit a record closing high.

European markets edged lower on Wednesday as the EU cut its growth forecast and tensions in the British-American relationship moved center stage.

The pan European Stoxx 600 slid 0.2 percent. The German DAX dropped half a percent, while France's CAC 40 index and the U.K.'s FTSE 100 both edged lower by 0.1 percent.

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