Sensex, Nifty Set To Open Higher In Cautious Trade

Indian shares look set to open higher on Wednesday following reports of renewed talks between the U.S. and China on trade. That said, the upside may remain capped by the expiration of derivative contracts due on Thursday and caution ahead of GDP data for the September quarter due Friday.

The dollar held near two-week highs after Federal Reserve Vice Chair Richard Clarida reaffirmed the need for further rate hikes, but cautioned the tightening path would be data dependant.

Oil prices rose on growing expectations for a production cut at a meeting of major oil producers early next month.

Benchmark indexes Sensex and the Nifty rose around half a percent on Tuesday while the rupee recovered by 8 paise to close at 70.79 against the dollar.

Asian stocks are broadly higher this morning ahead of a highly-anticipated speech from Fed Chair Powell later in the day. Benchmark indexes in China, Hong Kong and Japan are up between 0.4 percent and 0.8 percent while Seoul shares are little changed.

Overnight, U.S. stocks eked out modest gains after White House economic advisor Larry Kudlow said the Trump administration has restarted talks with the Chinese government “at all levels” and that the upcoming Trump-Xi meeting at the G20 summit offers an “opportunity to break through”.

The Dow rose 0.4 percent and the S&P 500 gained 0.3 percent while the tech-heavy Nasdaq Composite finished marginally higher.

European markets closed lower on Tuesday as investors remained focused on U.S.-China trade tensions and regional politics.

The pan-European Stoxx Europe 600 index gave up 0.3 percent. The German DAX dropped 0.4 percent, France’s CAC 40 index slipped 0.2 percent and the U.K.’s FTSE 100 declined 0.3 percent.

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