Positive global markets; can inflation numbers cheer Nifty?

Moneycontrol Bureau

Weak global cues dragged benchmark indices to their lowest level in two months on Thursday. Bearish economic outlook and a weak rupee discouraged buyers from looking for bargains at lower levels.

The Sensex shed 214 points to close at 18827.16, and the Nifty fell 61 points to 5699.10 as Finance Minister P Chidambaram's assurances on the health of the economy failed to calm jittery investors.

Meanwhile, a CNBC-TV18 poll sees the May wholesale inflation to be largely unchanged at 4.8 percent versus 4.89 percent. Food inflation is seen coming higher, but core inflation could fall to 2.3-2.6 percent. 

US Markets
The US markets ended near session highs with over 1 percent gains lifted by a pair of better-than-expected economic data. What also boosted the stocks was a Wall Street Journal report that stated that an adjustment in the Federal Reserve's bond-buying program did not mean that the central bank would end "all at once" or that the Fed was "anywhere near raising short-term interest rates." the CBOE volatility index tumbled near 16.

The Dow Jones soared 180.85 points, or 1.21 percent, to finish at 15,176.08. The S&P 500 jumped 23.84 points, or 1.48 percent, to close at 1,636.36. And the Nasdaq rallied 44.94 points, or 1.32 percent, to end at 3,445.37.

The weekly jobless claims declined to 334,000 last week falling near the lowest level in nearly five years, retail sales, however, climbed 0.6 percent in May.

European Markets
European markets pared losses to close flat post positive US economic data. The FTSEurofirst 300 closed 0.02 percent lower at 1,174.57 points. Earlier the index traded as much as 1.7 percent lower, as uncertainty over whether central banks would roll back stimulus measures continued to  jitter global markets.

In Greece, Prime Minister Antonis Samaras agreed to meet with opposition leaders after the government's abrupt closure of the state broadcasting service caused nationwide strikes and protests.

Asian Markets
Tokyo rebounded strongly on the back of US gains. Rising retail-sales data helped weaken the yen and lift exporters from Thursday's steep losses. Several exporters gained with the dollar firmly back above 95 to the yen after dipping under 94 on Thursday . The MSCI Asia Pacific index also rose 1 percent yesterday.

In the currency space, the  dollar continues to remain under pressure while the euro is still above 1.33 to the dollar. The dollar index stayed below the 81 mark. Meanwhile, the dollar yen is below the 95 level.

In commodities, Brent Crude is above 104 dollars per barrel. From the precious metals space, gold is hovering around 1385 dollars an ounce.