5 factors influencing market sentiment in Tuesday's session

World's largest fund manager BlackRock has turned bullish on emerging markets. Ace investor Mohamed El-Erian warned keeping interest rates low for long time may lead to financial instability, while at home a business confidence index registered an increase of over 2 per cent sequentially.

Below is a wrap up of all this and more developments that make or mar your markets in Tuesday's session.
 

1. Mohamed El-Erian makes case for rate hike: In an interview to Bloomberg Radio, Mohamed El-Erian, chief economic advisor at Allianz SE said US Federal Reserve should slowly try to normalise rates even as data does not support recovery in US economy, otherwise extraordinary monetary policy may lead to financial instability. The comments came ahead of the Chair Janet Yellen's speech on Friday at the annual central bankers' meeting in Jackson Hole, Wyoming.
2. BlackRock bullish on emerging markets: BlackRock upgraded emerging market stocks to 'overweight' from neutral, which shows the global fund manager expects the EM equities to do well, in US dollar terms, over the next three months. It believes the fundamentals of EMs are improving and a stable outlook on account of the prospects of Fed raising rates will boost growth in developing markets.
3. Oil prices slump over 3%: Oil prices extended losses to trade below $49 on Tuesday after settling down more than 3 per cent. The prices had touched two-month highs last week, on worries over burgeoning Chinese fuel exports, more Iraqi and Nigerian crude shipments and a rising US oil rig count.
4. Global markets trade sideways: Wall Street was little changed on Monday as a drop in oil prices weighed on the energy sector. Meanwhile, Asian markets were trading mixed as the whole world seems to have gone mum ahead of comments from Fed Chair Janet Yellen at Jackson Hole meeting on Friday.
5. Business confidence improves: Economic think-tank NCAER's business confidence index (BCI) registered a sequential increase of 2.2 per cent in June quarter of 2016-17, mainly driven by improvement in perception about economic conditions and financial position of firms in the next six months.