Sensex, Nifty Set For Muted Open As US Yields Climb On Inflation, Rate Concerns

(RTTNews) - Indian shares are likely to open on a muted note Friday as investors react to signs of weaker GDP growth and stubborn inflationary pressures in the U.S.

Technology stocks could be in focus after 10-yr U.S. bond yield rose sharply to a fresh five-month high of 4.73 percent.

On the positive side, a blowout first quarter earnings report from Google parent firm Alphabet after the U.S. closing bell may help limit the overall downside in the broader market.

Microsoft also reported quarterly results that beat Wall Street estimates. Benchmark indexes Sensex and Nifty surged around 0.7 percent each on Thursday to extend gains for the fifth straight session on eve of the Nifty F&O monthly expiry. The rupee gained 5 paise to close at 83.28 against the dollar.

Asian markets traded mixed this morning ahead of a closely watched policy decision by the Bank of Japan and the release of the Fed's preferred measure of inflation gauge.

Gold edged up slightly but was set for a weekly decline. Oil prices rose after U.S. Treasury Secretary Janet Yellen told Reuters that U.S. GDP growth for the first quarter could be revised higher and that inflation will ease to more normal levels.

U.S. stocks ended lower but off their day's lows overnight, following disappointing earnings updates from IBM and Meta Platforms.

Treasury yields climbed as new data showed slowing GDP growth but strong inflation, raising fears of stagflation.

Data showed that U.S. GDP slowed to 1.6 percent annualized in the first quarter after surging by 3.4 percent in the fourth quarter of 2023.

Core inflation came in stronger at 3.7 percent in Q1, picking up from a 2 percent annualized rate and pushing out rate-cut bets to December.

The Dow gave up 1 percent, the the-heavy Nasdaq Composite declined 0.6 percent and the S&P 500 dipped half a percent.

European stocks closed mostly lower on Thursday as mixed earnings and weak U.S. data offset big M&A news in the mining sector.

The pan European STOXX 600 fell 0.6 percent. The German DAX lost 1 percent and France's CAC 40 shed 0.9 percent while the U.K.'s FTSE 100 added half a percent.