Stocks poised for negative start on weak global cues

SGX Nifty: Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could slide 89 points at the opening bell. Overseas, Asian stocks traded lower on Wednesday following an overnight tumble on Wall Street and bond yields spiked on concerns about inflation. Investors watched the 10-year treasury yield, which crossed the 1.5% mark on Monday and has continued rising and was last sitting at 1.553%.

Yields move inversely to prices. US stocks fell sharply on Tuesday, with tech names dragging down the broader markets as treasury yields traded near three-month highs and lawmakers in Washington continued their budget stalemate. Also weighing on sentiment was a budget showdown in Washington. Senate Republicans blocked a House-passed bill Monday that would have funded the government into December and suspended the debt ceiling until December of 2022.

Congress must approve government funding by Friday to avoid a shutdown, and treasury secretary Janet Yellen warned Congress in a letter on Tuesday that lawmakers need to raise the debt limit by October 18 to avoid a government default. President Biden’s massive infrastructure plan also faces an uncertain future.

Domestic markets:

Back home, the key equity indices ended with steep losses on Tuesday, snapping their three-day rising streak. The barometer index, the S&P BSE Sensex, declined 410.28 points or 0.68% to close at 59,667.60. The Nifty 50 index fell 106.50 points or 0.60% to close at 17748.60. Foreign portfolio investors (FPIs) sold shares worth Rs 1,957.70 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 161.45 crore in the Indian equity market on 28 September, provisional data showed.

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