The S&P 500 and the Nasdaq closed sharply higher on Wednesday after Federal Reserve chair Jerome Powell acknowledged that inflation was starting to ease, in remarks he made following a quarter-point rate hike by the U.S. central bank.
The Dow Jones Industrial Average rose 6.92 points, or 0.02%, to 34,092.96, the S&P 500 gained 42.61 points, or 1.05%, to 4,119.21 and the Nasdaq Composite added 231.77 points, or 2%, to 11,816.32.
Asian Markets
Stocks in the Asia-Pacific traded mixed on Thursday as investors digested the U.S. Federal Reserve’s smaller rate hike of 25 basis points and Fed Chairman Jerome Powell acknowledged inflation is falling.
South Korea’s Kospi rose 1%. In Japan, the Nikkei 225 traded just above the flatline while the Topix lost 0.12%. In Australia, the S&P/ASX 200 rose 0.34%.
Trends in the SGX Nifty indicate a negative opening for the broader index in India with a loss of 84 points. The Nifty futures were trading around 17,616 levels on the Singaporean exchange.
US Fed unveils smaller rate hike but signals inflation fight not over
America’s Federal Reserve slowed its pace of interest rate hikes Wednesday, tempering an aggressive campaign to rein in costs as inflation cools while signaling the battle is not yet over. The US central bank announced a quarter-point hike to the benchmark lending rate at the end of its two-day policy meeting, taking the rate to a target range of 4.50-4.75 percent.
“Inflation has eased somewhat but remains elevated,” said the Fed’s policy-setting Federal Open Market Committee (FOMC) in a statement.
“The committee anticipates that ongoing increases in the target range will be appropriate” to bring inflation back to policymakers’ two percent target over time, the statement said.
Budget unveils slew of measures to give a leg-up to domestic manufacturing
Domestic production has been given a fresh fillip in Budget 2022-23. Finance Minister Nirmala Sitharaman has chosen to announce customs duty cuts on a number of items to protect local production.
Budget 2022-23 has given import duty relief to deepen the domestic value-addition in the manufacture of mobile phones. While announcing relief in customs duty on import of certain parts and inputs, such as camera lens, the Budget has decided to continue the concessional duty on lithium-ion cells for batteries for another year.
Budget 2023: State-run OMCs receive Rs 30,000 crore for capital support
The Union Budget 2023-24 announced by Finance Minister Nirmala Sitharaman on February 1 has allocated Rs 30,000 crore for capital support to state-run Oil Marketing Companies (OMCs).
The Ministry of Petroleum and Natural Gas has provided the allocation to OMCs—Indian Oil Corporation (IOCL), Bharat Petroleum Corporation (BPCL), Hindustan Petroleum Corporation (HPCL)—which have booked losses in the first half of the current financial year.
HDFC, Tata Consumer Products, Titan Company, Aditya Birla Capital, Aegis Logistics, Apollo Tyres, Bajaj Electricals, Berger Paints India, Birlasoft, Cera Sanitaryware, Coromandel International, Crompton Greaves Consumer Electricals, Dabur India, Deepak Fertilisers, Godrej Properties, Karnataka Bank, Max India, SIS, Ujjivan Small Finance Bank, and Welspun Corp will be in focus ahead of quarterly earnings on February 2.
Foreign institutional investors (FII) have net-bought shares worth Rs 1,785.21 crore, while domestic institutional investors (DII) have net-purchased shares worth Rs 529.47 crore on February 1, as per provisional data available on the NSE.
South Korea slides toward recession as Jan exports plunge
South Korea’s economy inched toward its first recession in three years as data on Wednesday showed its January trade deficit soared to a record thanks to a plunge in exports caused by a combination of long holidays and cooling global demand.
Asia’s fourth-largest economy, which relies heavily on trade for growth, shrank by 0.4% in the October-December quarter and is now on the brink of falling into what would be its first recession since the middle of 2020 during the height of the COVID-19 pandemic.
Exports fell 16.6% in January from a year earlier, trade ministry data showed, worse than an 11.3% decline predicted in a Reuters survey and the fastest drop in exports since May 2020.
Stocks under F&O ban on NSE
The National Stock Exchange has retained Ambuja Cements on its F&O ban list for February 2. Securities thus banned under the F&O segment include companies where derivative contracts have crossed 95 percent of the market-wide position limit.
With inputs from Reuters and other agencies
