Sensex, Nifty Seen Up On Strong Macro Data, Falling Oil Prices

(RTTNews) - Indian shares are likely to open on a positive note Wednesday as soft U.S. inflation data reinforced views that the Federal Reserve will cut rates as early as this spring.

Also helping ease concerns around inflation, oil prices fell about 4 percent to a six-month low on Tuesday amid lingering concerns about the outlook for fuel demand and worries about possible oversupply in the market.

Investors may also react to macro data showing that India's industrial output hit a 16-month high of 11.7 percent in October and retail inflation accelerated in November on food prices.

India's consumer price index registered an annual increase of 5.55 percent in November, following October's 4.87 percent gain. That was slightly better than economists' forecast of 5.7 percent.

Benchmark indexes Sensex and Nifty ended Tuesday's session down about half a percent each, while the rupee ended flat at 83.38 against the dollar.

Asian markets traded mixed this morning as investors waited for the Fed's monetary policy announcement later in the day for clues on whether the U.S. central bank will cut borrowing costs next year.

The dollar was on the defensive and bond yields hovered near their recent lows while gold held near a three-week low.

Brent crude futures steadied after touching their lowest level since late June on concerns of softening demand and oversupply.

U.S. stocks rose overnight to reach their best closing levels in well over a year as new data showed consumer price inflation continued to slow, in line with expectations.

The annual rate of growth eased to 3.1 percent in November from 3.2 percent in October while core consumer price growth came in unchanged at 4.0 percent year-over year.

The Dow and the S&P 500 both gained about half a percent while the tech-heavy Nasdaq Composite climbed 0.7 percent.

European stocks ended flat to slightly lower on Tuesday after a choppy ride. The pan European STOXX 600 eased 0.2 percent.

France's CAC 40 slipped 0.1 percent while the German DAX and the U.K.'s FTSE 100 finished little changed with a negative bias.