Sensex, Nifty Seen Opening Up As Soft US Data Lifts Rate Cut Bets

(RTTNews) - Indian shares look set to open higher on Wednesday as investors cheer yet another record-breaking session on Wall Street overnight.

Underlying sentiment may remain supported somewhat as softer-than-expected U.S. retail sales data reinforced bets of imminent Federal Reserve rate cuts.

Currently, all eyes are set on the upcoming Union Budget 2024, which is expected to be presented in July. It is expected that the Budget will focus on reforming the tax structure in the country and reducing taxes.

Benchmark indexes Sensex and Nifty rose around 0.4 percent each on Tuesday as traders returned to their desks after a long holiday weekend.

The rupee gained 13 paise to settle at 83.42 against the dollar, buoyed by fresh foreign fund inflows.

Asian markets traded mixed this morning, gold held steady, and the dollar nursed loses while oil hovered near a seven-week high on signs of escalating geopolitical tensions in Europe and the Middle East.

U.S. stocks rose overnight as investors digested mixed economic data and commentary from a slew of Fed officials emphasizing the need for more evidence of cooling inflation before lowering rates.

May industrial production and manufacturing output both beat expectations while retail sales barely rose and April's data was revised significantly lower, sending Treasury yields lower and helping investors increase bets on two interest-rate increases this year.

The S&P 500 inched up 0.3 percent and the tech-heavy Nasdaq Composite finished marginally higher to reach new record closing highs while the Dow rose 0.2 percent.

European stocks extended gains for a second day running on Tuesday as government bond yields edged lower on easing concerns over political risk in France.

The pan European STOXX 600 climbed 0.7 percent. The German DAX edged up 0.4 percent, France's CAC 40 added 0.8 percent and the U.K.'s FTSE 100 gained 0.6 percent.