Most Asian stocks crept lower on Tuesday, cooling from recent gains as investors awaited more cues on interest rates this week, while Indian shares hovered around record highs on bets that the BJP won a third consecutive term in the 2024 general elections.
Regional stocks took middling cues from a mixed overnight close on Wall Street. While technology stocks rose tracking gains in NVIDIA Corporation (NASDAQ:NVDA), broader markets were muted amid signs of cooling economic activity.
U.S. stock futures were flat in Asian trade, with focus turning squarely towards upcoming labor data for more cues on interest rates.
A string of central bank meetings are due in the coming days. The European Central Bank and the Bank of Canada are set to cut rates this week, while the Federal Reserve is set to keep rates steady next week.
India’s Nifty 50 futures flat, election results awaited
Gift Nifty 50 Futures fell slightly on Tuesday, as vote counting began for the 2024 general election.
Exit polls over the weekend showed a sweeping victory for the NDA alliance, led by the BJP. This presented an unprecedented third consecutive term for Prime Minister Narendra Modi.
Indian stocks rallied to record highs on Monday after the exit polls, with the Nifty 50 sitting well above 23,000 points, while the BSE Sensex 30 blew past 76,000 points.
Investors have largely welcomed the BJP’s pro-business policies over the past decade, which also saw India’s economy grow sharply in recent years. This in turn sparked a series of record highs on the Nifty, as optimism over the Indian economy also attracted a slew of foreign investors.
Broader Asian markets rangebound before more rate cues
Broader Asian markets moved in a flat-to-low range, as anticipation of U.S. labor data and a string of key central bank meetings kept sentiment subdued.
Japan’s Nikkei 225 index fell 0.5%, while the broader TOPIX lost 0.4%.
Australia’s ASX 200 fell 0.1% following a batch of weak economic readings. A survey showed Australian companies clocked weaker-than-expected gross operating profits in the first quarter, while the country slipped into a current account deficit in the quarter.
Net exports contribution to the gross domestic product also shrank 0.9% in the quarter, presenting a weak outlook for first quarter GDP data due on Wednesday.
China’s Shanghai Shenzhen CSI 300 rose 0.3%, while the Shanghai Composite fell 0.1% following mixed signals from key purchasing managers index data over the past two sessions.
Technology-heavy indexes also retreated from strong gains in the prior session. South Korea’s KOSPI fell 0.4%, while Hong Kong’s Hang Seng index tread water.
Source: Investing