Sensex, Nifty may open higher on positive global cues

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Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could surge 123 points at the opening bell. The Reserve Bank of India (RBI)’s Monetary Policy Committee (MPC) kicked off its three-day policy meet on 6 December 2021. MPC’s interest rate decision will be announced today, 8 December 2021. In the previous meeting, MPC kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4%.

Global markets:

Overseas, Asian stocks are trading higher on Wednesday, continuing a global relief rally as markets found positive news in early reports about the potential impact of the Omicron variant.

Japan’s economy in the July-September period contracted deeper than initially estimated last quarter amid a summer surge in COVID-19 cases that triggered emergency restrictions. Japan’s economy in the July-September period shrank an annualized real 3.6% from the previous quarter, downgraded from the 3% contraction initially reported, government data showed Wednesday.

British drugmaker GSK reportedly said on Tuesday its antibody-based COVID-19 therapy with U.S. partner Vir Biotechnology is effective against all mutations of the new Omicron coronavirus variant.

US stocks jumped for a second day, continuing their rebound from a recent rough patch, as investors grew less fearful of the potential economic impact from the new omicron coronavirus variant.

The US trade deficit narrowed sharply in October as exports soared to a record high, potentially setting up trade to contribute to economic growth this quarter for the first time in more than a year. The commerce department said on Tuesday that the trade gap plunged 17.6% to $67.1 billion.

The House passed a bill that would allow the Senate to raise the debt ceiling with a simple majority vote. The U.S. is expected to hit its debt ceiling around December 15, which raises the threat of a default. Once the legislation gets through the Senate and to President Joe Biden’s desk, Congress can hold separate votes to increase the U.S. borrowing limit.

Domestic markets:

Back home, domestic equity benchmarks rebounded after two days of relentless selling and closed near the day’s high. The barometer index, the S&P BSE Sensex, surged 886.51 points or 1.56% to 57,633.65. The Nifty 50 index rallied 264.45 points or 1.56% to 17,176.70.

Foreign portfolio investors (FPIs) sold shares worth Rs 2,584.97 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 2,605.81 crore in the Indian equity market on 7 December, provisional data showed.