The market is expected to open in the red as trends in SGX Nifty indicate a negative opening for the broader equity indices in India with a loss of 34 points.

Following a choppy session on August 18, the markets reversed losses during the last hour of the trade and closed higher for the eighth straight session. The BSE Sensex settled 38 points higher at 60,298, while the Nifty50 advanced 12 points to end the session at 17,956.5 and formed a bullish candlestick pattern on the daily charts.

As per the pivot charts, the key support level for the Nifty is placed at 17,883, followed by 17,809. If the index moves up, the key resistance levels to watch out for are 17,999 and 18,042.

The Dow Jones Industrial Average rose 18.72 points, or 0.06%, to 33,999.04, the S&P 500 gained 9.7 points, or 0.23%, to 4,283.74 and the Nasdaq Composite added 27.22 points, or 0.21%, to 12,965.34.

Asian Markets

Asian shares were left in limbo on Friday while the US dollar made all the running as recession clouds gathered over Europe and highlighted the relative outperformance of the US economy.

Added concerns about the health of China’s economy saw MSCI’s broadest index of Asia-Pacific shares outside Japan ease 0.3%, to be down 1.1% on the week. Chinese blue chips were flat, while South Korea lost 0.5%. Japan’s Nikkei fared better with a 0.3% gain due in part to a renewed slide in the yen.

SGX Nifty

Trends in SGX Nifty indicate a negative opening for the broader index in India with a loss of 34 points. The Nifty futures were trading around 17,970 levels on the Singaporean exchange.

Oil edges higher on optimism for firmer crude demand

Oil prices edged higher in early trade on Friday, extending a rally into the third day, as investors weighed hopes for strong fuel demand after a larger-than-expected drawdown in U.S. crude stocks, brushing off worries about a global economic slowdown.

Brent crude futures climbed 7 cents, or 0.1%, to $96.66 a barrel by 0030 GMT after settling 3.1% higher on Thursday. US West Texas Intermediate crude was at $90.65 a barrel, up 15 cents, or 0.2%, following a 2.7% increase in the previous session.

RBI Bulletin | Inflation will fall to 5% in Q1 FY24, but not yet positioned for landing

India’s headline retail inflation, as measured by the Consumer Price Index, will ease to 5 percent by April-June of the next fiscal year, the Reserve Bank of India said in the monthly bulletin released on August 18.

With the trajectory of outcomes largely in line with projections, we expect momentum to ease from 3.0 percent in Q1 (April-June) to 1.7 percent in Q2 and further to 1.3 percent in Q3 and turn mildly negative in Q4 before picking up modestly and on seasonal food price effects to 2.2 percent in Q1 FY24.

If these expectations hold, inflation will fall from 7 percent to 5 percent by April-June next year, within the tolerance band, hovering closer to the target, but not yet positioned for landing.

Gold drops to 3-week low on US dollar strength, rate-hike fears

Gold prices slipped to a three-week low on Friday and were heading for their first weekly decline in five, as a stronger dollar and prospects of more rate hikes by the US Federal Reserve dented bullion’s appeal. Spot gold was down 0.2% at $1,755.89 per ounce, as of 0107 GMT, after falling to its lowest since July 29 at $1,753.68 in early Asian trading. For the week so far, the metal is down 2.5%.

US home sales fell again in July as the housing slowdown deepens

Sales of previously occupied US homes slowed for the sixth consecutive month in July, deepening the housing markets slide under the weight of sharply higher mortgage rates, surging inflation, and slower, but still solidly rising home prices.

The National Association of Realtors said Thursday that existing home sales fell 5.9% last month from June to a seasonally adjusted annual rate of 4.81 million. That’s lower than what economists were expecting, according to FactSet. Sales fell 20.2% from July last year. Sales have now fallen to the slowest pace since May 2020, near the start of the pandemic.

FII and DII data

Foreign institutional investors (FIIs) turned net sellers for the first time in the current month, offloading shares worth Rs 1,706 crore, whereas domestic institutional investors (DIIs) net bought shares worth Rs 470.79 crore on August 18, as per provisional data available on the NSE.

Japan’s inflation holds above the BOJ target, and price pressures broaden

Japan’s core consumer inflation accelerated in July to its fastest in seven-and-a-half years, driven by fuel and raw material prices and adding to the costs of living for households yet to see significant wage gains.

While inflation exceeded its 2% target for four straight months, the Bank of Japan (BOJ) is likely to remain an outlier in keeping monetary conditions ultra-loose with price rises still modest compared with other major economies.

The core consumer price index (CPI), which excludes fresh food prices, rose 2.4% in July from a year earlier, matching a median market forecast, government data showed on Friday. That followed a 2.2% gain in June and marked the fastest pace since December 2014, excluding sales tax hike effects.