India stocks seen lower pre-RBI rate decision; inflation fears mount
Indian shares are expected to open lower on Wednesday as persistent inflationary pressures from the Middle East war prompt a widely anticipated 25 basis point rate hike by the Reserve Bank of India. Governor Sanjay Malhotra's comments on inflation risks will be closely watched for future rate path signals.
Indian shares are expected to open lower on Wednesday ahead of a widely anticipated Reserve Bank of India rate increase, as persistent inflation pressure from the Middle East war weighs on sentiment globally. m. 1 on Tuesday. The RBI is expected to raise rates by 25 basis points, its first increase since February 2023, with Governor Sanjay Malhotra's comments on inflation risks to be watched closely for clues on the future rate path.
Analysts at Goldman Sachs, led by Santanu Sengupta, said the monetary policy committee may also change its stance from neutral to calibrated tightening or withdrawal of accommodation. 5%, weighed down by higher oil prices, rising US bond yields on inflation worries and foreign outflows from Indian equities. Margins are expected to improve from rising floating rates, VK Vijayakumar, chief investment strategist at Geojit Investments, said.
He said a potential rate hike would pressure non-bank lenders' margins as funding costs reprice faster than loan yields, especially for fixed-rate vehicle and microfinance lenders, while floating-rate housing financiers are relatively better positioned. JM Financial said other rate-sensitive sectors, including real estate and consumer companies, could also see earnings outlooks affected by the RBI's assessment of inflation and growth, according to three analysts. 5 as storm risks to US oil output and Houthi attacks on Saudi Arabia outweighed increased Middle East supply.
Asian markets were muted after Wall Street equities rose overnight, with the S&P 500 and Nasdaq hitting record highs as easing US yields reduced expectations of a near-term Federal Reserve rate hike. Titan Company said quarterly consumer business sales grew 25% year-on-year in the September quarter, driven by demand for jewellery, watches and eyewear. 2% year-on-year increase in consolidated net profit for the June quarter. 4 million euros contract from Social Security Scotland.
3900 Indian rupees. Reporting by Bharath Rajeswaran in Bengaluru; Editing by Ronojoy Mazumdar and Subhranshu Sahu. Contact: +91 9769003463.