Sensex, Nifty Set To Open Higher As Yields Drop On Soft US GDP Print

(RTTNews) - Indian shares may open on a positive note Friday as weaker U.S. growth data sent the dollar and bond yields tumbling and revived hopes for rate cuts by the Federal Reserve later this year.

Meanwhile, the Reserve Bank of India (RBI), in its annual report, projected Indian economy to grow at 7 percent in the current financial year with risks evenly balanced.

Further, the report said India' GDP has expanded at a robust pace in 2023-24, with real GDP growth accelerating to 7.6 percent from 7 percent in the previous year - the third successive year of 7 percent or above growth.

Benchmark indexes Sensex and Nifty fell 0.8 percent and 0.9 percent, respectively on Thursday due to weak global cues and on eve of monthly F&O expiry.

The rupee rebounded to settle nine paise higher at 83.31 against the dollar.

Asian stocks pared some early gains as official data showed Chinese manufacturing activity unexpectedly contracted in May - with the corresponding PMI falling to 49.5 from 50.4 in April.

The non-manufacturing PMI - a measurement of sentiment in the service and construction sectors - fell to 51.1 from 51.2.

The dollar weakened against major currencies ahead of the release of key euro zone and U.S. inflation readings later in the day.

Gold edged up slightly and was set for a fourth monthly gain.

Oil extended overnight losses after EIA data showed a jump in gasoline inventories in the week ended May 24th.

U.S. stocks ended lower overnight as software giant Salesforce reported disappointing quarterly results and revised data showed the U.S. economy grew less than previously expected in the first quarter.

GDP grew 1.3 percent in the first quarter compared to the previously reported 1.6 percent jump.

Weekly jobless claims rose more than expected while pending home sales in April fell to their slowest pace since April 2020, separate set of data revealed.

The Dow shed 0.9 percent to reach its lowest closing level in almost a month, the S&P 500 dipped 0.6 percent and the tech-heavy Nasdaq Composite gave up 1.1 percent.

European stocks rose on Thursday as bonds regained some ground after a sell-off the previous day.

The pan European STOXX 600 gained 0.6 percent. The German DAX edged up 0.1 percent while France's CAC 40 and the U.K.'s FTSE 100 both gained around 0.6 percent.