Market Morning Brief: What you must know as trading begins on Dalal Street
February 29, 2016
Good Morning Business Today readers!
The big Budget day has finally arrived. While budget announcements will largely shape up today's market movement and will hog limelight throughout the day, you must not ignore global developments as well that panned out over the weekend.
We bring you all important global and domestic updates along with of course budget buzz that you must know before playing the bourses:
- Dalal Street not too enthused about Budget 2016: As Finance Minister Arun Jaitley reaches Parliament to present the much-awaited Budget 2016, the domestic markets were trading on a flat note. Amisha Vora of Prabhudas Liladhar believes markets will not move beyond 5 per cent in any direction from the current levels and that range will be more dictated by the global risk uncertainties rather than Budget.
- G20 meet stalemate: The Group of 20 economies were unable to agree on a joint push for new stimulus measures at a meeting which ended on Saturday, turning attention instead to upcoming business surveys from China, Japan, Europe the United States. Central banks in Europe and Japan may inject a little more stimulus into their economies later in March. But the Federal Reserve and the Bank of England look likely to sit tight for now, meaning hopes for a period of calm in the world's volatile financial markets lie largely with the indicators.
- US economic data: The Commerce Department said gross domestic product expanded at a 1-per cent annual rate in the fourth quarter, an upward revision from its previous estimate of 0.7 per cent growth. The data exacerbated concerns that the US Federal Reserve could raise rates sooner rather than later. The economy grew at a rate of 2.0 per cent in the third quarter.
- Wall Street and Asian markets: Wall Street ended lower on Friday after US economic data triggered concerns about the timing of future interest rate hikes. Asian stocks were also off to a cautious start on Monday after a meeting of the Group of 20 economic policymakers ended with no new coordinated action to spur global growth and as solid US data revived expectation of a US rate hike before year-end. China's Shanghai Composite index fell over 3 per cent, while Hong Kong's Hang Seng index shed nearly 1 per cent. Japan's Nikkei bucked the trend to gain 0.41 per cent.
- Oil prices up, gold gains: Brent futures climbed around half a dollar, or 1.4 per cent on Monday after gaining over 15 per cent last week, with some indicators pointing to the possibility the market is showing signs of bottoming out. Gold, on the other hand, steadied near $1,220 an ounce, nursing losses from the previous session, but was poised to log its best monthly performance in four years as safe-haven demand from stock market turmoil bolstered the metal.