Dalal Street is set to open higher on Thursday following positive global sentiment spurred by signs of potential resolution to the ongoing US government shutdown. The anticipation of a US-India trade deal, coupled with easing inflation, is expected to bolster the current stock market rally.
Nifty futures were trading at 25,950.5 points at 8:00 am, indicating an opening above Wednesday’s closing level of 25,875.80. Both Sensex and Nifty have recorded approximately a 1.5% increase this week and are now trading just under 2% below their previous record highs from September 2024.
US President Donald Trump’s optimistic remarks regarding trade discussions with India and the likelihood of a Federal Reserve rate cut in December have instilled confidence among investors. The potential conclusion of the US government shutdown is also poised to enhance global market sentiment by enabling the release of crucial economic data that was delayed during the closure.
Internally, factors like the sharp decline in retail inflation to 0.25% in October, attributed to lower food prices and tax cuts on consumer goods, have raised expectations of a potential interest rate cut by the Reserve Bank of India in its upcoming policy meeting, providing additional support to the markets.
Market experts highlighted the positive momentum of Indian markets on Wednesday, with the Nifty showing consistent gains, marking its fourth consecutive day of positivity. The progress in the US Senate toward ending the government shutdown and the anticipation of a potential Fed rate cut next month have further bolstered investor confidence.
While markets in Asia traded higher following the record close of the Dow Jones Industrial Average, there is optimism that the conclusion of the US government shutdown will revitalize global trade and reduce uncertainty.
Experts anticipate that if the US government reopens promptly, markets could extend their winning streak, potentially reaching new record highs by the end of November, supported by global stability and domestic economic resilience.