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Indian Shares Likely To Have A Flat Opening

Indian shares look set to open on a flat note Wednesday after the International Monetary Fund (IMF) raised its FY22 growth forecast for India to 12.5 percent from 11.5 percent estimated earlier in January, but warned about severe downside risks because of the current pandemic wave the country is experiencing.

The pandemic situation has worsened in India and the next four weeks will be very, very critical, the Centre on Tuesday said as the country recorded over 1.07 lakh new cases of infection, the highest one-day spike in Covid-19 cases.

Benchmark indexes Sensex and the Nifty ended Tuesday's choppy session marginally higher while the rupee dropped by 12 paise to close at 73.42 against the U.S. dollar.

The Reserve Bank of India's monetary policy announcement is due later in the day, with the central bank likely to keep rates unchanged and maintain an accommodative stance despite a gradual build-up in inflationary pressures.

Asian markets rose broadly to hover near three-week highs this morning, though Chinese and Hong Kong markets slipped on worries of policy tightening.

The dollar slipped to a two-week low and the five-year U.S. Treasury yields dropped sharply amid expectations that the Fed will not raise interest rates until 2024. Oil prices edged higher in Asian trade after reports suggested that crude oil stockpiles fell in the most recent week.

U.S. stocks fluctuated before ending slightly lower overnight as new trades linked to Archegos added unease to markets amid a quiet day on the economic front.

The Dow dropped 0.3 percent, while the tech-heavy Nasdaq Composite index and the S&P 500 both ended marginally lower.

European stocks ended Tuesday's session on a firm note after the IMF upgraded its 2021 global growth forecast for this year and next, citing the accelerating rollout of Covid-19 vaccines and aggressive stimulus spending by the U.S. and other rich nations.

The pan European Stoxx 600 advanced 0.7 percent. The German DAX rose 0.7 percent, France's CAC 40 index gained half a percent and the U.K.'s FTSE 100 climbed 1.3 percent.

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