SGX Nifty suggests gap-up start for Indian indices

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Nifty futures were trading 213 points or 1.47% higher at 14,737.50 on Singapore Exchange, indicating a positive opening for BSE Sensex and Nifty 50 on Monday.

The market will also react to encouraging Q3 GDP data announced after market hours on Friday.

In economic data, Markit Manufacturing PMI for February will be declared today, 1 March 2021.

India’s economy returned to growth in its fiscal third quarter after a recession earlier in 2020. Gross domestic product grew 0.4% in October-December compared with the same period a year earlier, data released by the National Statistics Office on Friday showed. That compared with revised contractions of 7.3% in July-September and 24.4% in April-June.

The output of eight core infrastructure sectors grew marginally by 0.1% in January, mainly due to growth in the production of fertiliser, steel and electricity. The core sectors had expanded by 2.2% in January 2020, according to the provisional data released by the Commerce and Industry Ministry on Friday.

Global markets:

Overseas, Asian stocks are trading higher on Monday, as data releases showed China’s manufacturing activity growth slowing in February. South Korea’s markets are closed on Monday for a holiday.

A private survey released Monday showed China’s manufacturing activity in February growing at a slower pace. The Caixin/Markit manufacturing Purchasing Managers’ Index (PMI) came in at 50.9, a decline from January’s reading of 51.5.

China’s official manufacturing Purchasing Managers’ Index (PMI) for February came in at 50.6 over the weekend, according to data released by the country’s National Bureau of Statistics. That was lower than January’s reading of 51.3 but still above the 50 level that separates expansion from contraction.

US stocks ended on a mixed note on Friday. The Dow Jones Industrial Average tumbled 469.64 points, or 1.5%, to finish at 30,932.37, after touching a session low at 30,911.37 as Wall Street struggled to shake off fears of rapidly rising rates.

The S&P 500 lost 18.19 points, 0.5%, to close at 3,811.15 as energy and financial stocks pulled back. The Nasdaq Composite Index added 72.91 points, or 0.6%, to 13,192.34 as Big Tech names rebounded after a large sell-off in the previous session amid surging bond yields. Facebook, Microsoft and Amazon each rose more than 1%.

The House passed a $1.9 trillion Covid relief bill, the American Rescue Plan Act of 2021, early Saturday. The Senate will now consider the legislation.

Trade data showed that the U.S. trade deficit in goods widened to $83.7 billion in January from a revised $83.2 billion in the prior month, the Commerce Department said Friday. Imports of goods, such as consumer electronics, rose 1.1% to $218.9 billion in January. Goods imports were up 8.2% compared with a year earlier. Exports rose 1.4% to $135.2 billion, but were down 0.7% compared with one year ago.

Domestic markets:

Back home, domestic equity benchmarks slumped on Friday, led by broad-based selling pressure. A spike in domestic and global bond yields coupled with rising coronavirus cases spoiled investors’ appetite for risk assets. The barometer index, the S&P BSE Sensex, slumped 1939.32 points or 3.80% to 49,099.99. The Nifty 50 index tumbled 568.20 points or 3.76% to 14,529.15.

Foreign portfolio investors (FPIs) sold shares worth Rs 8,295.17 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 1,499.70 crore in the Indian equity market on 26 February, provisional data showed.