Sensex, Nifty Seen Higher At Open As US Inflation Cools

(RTTNews) - Indian shares may open higher on Thursday as investors react to firm global cues and mixed economic data released after market hours the previous day.

Government data showed India's retail inflation easing to a 12-month low of 4.75 percent annually in May, slightly down from the 4.83 percent recorded in April.

At the same time, India's industrial output growth slowed to a three-month low of 5 percent in April from 5.4 percent in March due to slower manufacturing growth.

Benchmark indexes Sensex and Nifty ended up around 0.2 percent each on Wednesday while the rupee added 3 paise to close at 83.56 against the dollar.

Asian markets rose broadly this morning, though Chinese stocks were subdued after the announcement of new EU tariffs on Chinese electric vehicles starting next month.

The dollar slipped and gold traded lower as investors weighed the higher-for-longer Fed rate outlook.

Oil prices declined In Asian trading, snapping a three-day winning streak after data showed an unexpected build in U.S. crude stockpiles.

U.S. stocks ended mostly higher overnight as signs of falling inflation fueled bets the Fed will lower interest rates in coming months.

Data showed U.S. consumer prices rose 3.3 percent in the year to the end of May, down 0.1 percentage points from the month before.

Core prices grew at their slowest annual pace in over three years despite rents continuing to weigh on household budgets.

Meanwhile, after leaving rates on hold for the seventh consecutive meeting, Fed Chair Jerome Powell acknowledged that inflation has eased substantially in recent months but remains too high.

The latest projections showed officials expect only one interest rate cut this year compared to the three forecast in March.

The accompanying dot plot indicated that more participants expect to cut twice than once, but no one expects to cut more than twice, while four don't expect to cut at all this year.

The tech-heavy Nasdaq Composite surged 1.5 percent and the S&P 500 rose 0.9 percent to reach new record closing highs while the Dow ended marginally lower, giving up early gains.

European stocks snapped a three-day losing streak Wednesday on expectations of a potential September rate cut by the Federal Reserve.

The pan European STOXX 600 climbed 1.1 percent. The German DAX rallied 1.4 percent, France's CAC 40 jumped 1 percent and the U.K.'s FTSE 100 gained 0.8 percent.