Indian benchmark indices opened on a strong note ahead of the Reserve Bank of India’s monetary policy to be announced later today. BSE Sensex opened 62.15 points or 0.2% higher at 31,252.71 points, while NSE Nifty, the broader gauge, opened 26.80 points or 0.28% higher at 9,663.95 points. At 9:25 am, BSE Sensex was trading 52.90 points or 0.17% higher at 31,243.46 points while the NSE Nifty was up 19.50 points or 0.20% at 9,656.65 points.
The Reserve Bank of India (RBI) will announce its monetary policy later today. A poll by CNBC-TV18 showed that 100 percent of the respondents that include top brokers and economists do not expect any action from the RBI on the repo rate front in the policy.
“RBI could maintain status quo on policy rates even as the case for a rate cut strengthens. While we are not expecting an outright cut in June policy review, we certainly expect the apex bank to acknowledge a softer growth-inflation mix and, hence, foresee a dovish tilt in monetary stance. We also see the likelihood of rate cuts over the 6-9 months,” said Edelweiss Securities.
The India Meteorological Department said on Tuesday that the rainfall during the June-September period will be normal this year. Met department upgraded its monsoon forecast to 98 percent for this year from 96 percent earlier. The weather office also predicted lower prospects of rain-busting El Nino conditions. The updated forecast will cheer farmers and policymakers and help keep food inflation under control.
Moody’s and Fitch on Tuesday cut Reliance Communications rating for the second time in a week, even as the Anil Ambani-led telecom major received a seven-month respite from bankers on debt repayment. Moody’s cut its rating to ‘Ca’, which suggests the debt is highly speculative and is very near or likely in default. Fitch lowered RCom’s rating to ‘RD’ from ‘CCC’.
You may also like to watch:
Asian markets across Japan, Korea, and Australia were trading lower in early morning trade. The US markets closed in the negative on Tuesday as ahead of Britain’s general elections scheduled for Thursday and European Central Bank’s policy meeting scheduled for Friday. The Dow Jones Industrial Average fell 47.81 points or 0.23 percent to 21,136.23 points, the S&P 500 lost 6.77 points or 0.28 percent to 2,429.33 points and the NASDAQ Composite dropped 20.63 points or 0.33 percent to 6,275.06 points.
The Indian Rupee fell against the US Dollar as traders remained cautious ahead of the monetary policy review scheduled Wednesday. The domestic currency opened at 64.49, down 7 paise 0.11% from its yesterday’s close of 64.42.
Crude oil prices continued to fall even after the OPEC’s decision last month to extend output cuts. Oil prices slipped below $50 a barrel on Tuesday on concerns that a diplomatic rift between Qatar and several Arab states including Saudi Arabia could undermine efforts by OPEC to tighten the market. Benchmark Brent crude oil was 20 cents a barrel lower at $49.27 while US light crude was down 20 cents at $47.20 per barrel.