Wall Street closed lower on Tuesday on tepid economic news while most markets in Asia softened after opening higher in early trade despite analysts’ optimism on the Japanese economy
The Indian market is likely to see a cautious opening on mixed global cues. Wall Street closed lower on Tuesday on tepid economic news while most markets in Asia softened after opening higher in early trade despite analysts’ optimism on the Japanese economy, brushing aside negative US economic indicators. The SGX Nifty, which opened in the green, was 12.50 points at 2,481.50, down from its previous close of 2,494.
The market continued its upmove yesterday despite the Asian pack witnessing a mixed trend in the morning. But volatility soon crept in, taking the indices to the day's lows in mid-morning trade. Seizing the opportunity, investors resorted to buying at lower levels, pushing the market up into the positive zone. Fluctuations continued for some time until another upmove gave the market some momentum. But the uptick was short-lived as the indices pared most of the gains, albeit ending in the green for the third straight day.
The Nifty closed 25 points up at 5,481, while the Sensex ended 72 points up at 18,274. The Nifty's next resistance is at 5,555. As we mentioned on Monday, if this level too is crossed in the next two days, the market will move up substantially-towards 5,700 and 5,800.
Stock markets in the US closed lower overnight on weak economic indicators. Data from the Labor Department showed import prices climbed 1.5% in January, boosted by higher costs for commodities like food and fuel. Besides, US retail sales rose just 0.3% in January, less than the 0.6% rise economists had expected. Besides, business inventories in December rose to their highest levels in nearly two years, pointing to a slowdown.
The Dow fell 41.55 points (0.34%) at 12,226.64. The S&P 500 shed 4.31 points (0.32%) at 1,328.01 and the Nasdaq declined 12.83 points (0.46%) at 2,804.35.
Markets in Asia softened a bit after opening higher in early trade on Wednesday, despite analysts’ optimism on the Japanese economy. Nomura Research Institute in a report dated 14th February said that Japan will emerge stronger in the first half of 2011, instead of its earlier prediction of the second half. Upgrades of corporates by analysts also lifted investor sentiments in the region.
The Nikkei 225 gained 0.39%, the Seoul Composite rose 0.05% and the Taiwan Weighted added 0.11%. On the other hand, the Shanghai Composite declined 0.28%, the Hang Seng fell by 0.26%, the Jakarta Composite lost 0.21%, the KLSE Composite fell 0.15% and the Straits Times was down 0.23% in early trade.
Back home, media reports said that the Central Bureau of Investigation (CBI) on Tuesday questioned a top executive of Unitech as part of a probe into a telecom corruption scandal that has roiled politics and spooked investors in Asia's third-largest economy.
Unitech managing director Sanjay Chandra was summoned by the CBI to answer questions over his role in a case that charges his firm was favoured by a former telecom minister when telecom licences were issued in 2008.