Sensex, Nifty Seen Higher At Open As US Inflation Cools

(RTTNews) - Indian shares look set to open higher on Thursday as tamer-than-expected U.S. CPI data led to some optimism about the Federal Reserve resuming interest rate cuts in the near future.

Additionally, domestic industrial output and retail inflation data also painted a positive picture of the economy.

India's industrial production growth accelerated at the start of the year, while consumer price inflation slowed to a seven-month low in February, raising expectations of interest rate cuts over coming months.

India's industrial production rose 5.0 percent year-over-year in January, faster than the revised 3.5 percent gain in December due to the developments in the manufacturing and mining segments. The expected increase was 3.5 percent.

Consumer price inflation eased more-than-expected to 3.61 percent in February from 4.26 percent in January. This was the lowest since July 2024.

The larger-than-expected fall in headline inflation to below the RBI's 4 percent target supports the view that the central bank will continue to loosen monetary policy over the coming months.

Benchmark indexes Sensex and Nifty fluctuated before ending marginally lower on Wednesday, with IT stocks pacing the decliners. The rupee inched up by 2 paise to close at 87.19 against the dollar.

Foreign institutional investors offloaded shares worth Rs 1,627.61 crore on a net basis Wednesday while domestic institutional investors were net buyers of shares to the extent of Rs 1,510.35 crore, as per provisional data.

Asian markets were mixed this morning as U.S. President Donald Trump escalated global trade tensions by threatening more tariffs on EU goods. Trump also hinted at financial repercussions if Russia rejects the Ukraine ceasefire proposal.

The dollar edged higher, thanks to a rise in U.S. Treasury yields amid concerns over the outlook for future inflation and the state of the U.S. economy.

Gold ticked higher and traded above $2,940 per ounce due to ongoing tariff uncertainty.

Oil steadied after the biggest gain in two weeks on signs of tighter U.S. supplies and OPEC's decision to maintain its outlook for global oil demand growth in 2025.

U.S. stocks ended mostly higher overnight as consumer inflation came in lower than forecast by economists.

Data showed that CPI rose 2.8 percent annually in the month, down from 3.0 per cent in January and below the 2.9 percent forecast from economists.

The core CPI, which excludes volatile food and energy prices, rose 3.1 percent on an annual basis, following the 3.3 percent increase in January.

White House Press Secretary Karoline Leavitt said the report showed "the economy is moving in the right direction under President Trump."

The tech-heavy Nasdaq Composite rallied 1.2 percent to rebound from six-month lows hit in the previous session.

The S&P 500 rose half a percent to snap a two-day losing streak while the narrowed Dow dipped 0.2 percent.

European stocks rebounded on Wednesday after four days of declines as Ukraine agreed to the U.S.-proposed 30-day ceasefire plan and the EU and Canada swiftly retaliated against Trump's steel and aluminum tariffs.

The pan European STOXX 600 climbed 0.8 percent. The German DAX rallied 1.6 percent, France's CAC 40 advanced 0.6 percent and the U.K.'s FTSE 100 gained half a percent.