Indian Shares Set For Gap-down Opening After Wall Street Rout

(RTTNews) - Indian shares look set to open sharply lower on Monday following a brutal sell-off for Wall Street on Friday after Fed Chair Jerome Powell made hawkish remarks in Jackson Hole, Wyoming.

He declared that the "economy does not work for anyone" without price stability and the central bank would use its tools "forcefully" that could mean slower growth, a weaker job market and "some pain" for households and businesses.

The Dow fell 3 percent on Friday, the S&P 500 plunged 3.4 percent and the tech-heavy Nasdaq Composite index lost 3.9 percent, as Powell reiterated the Fed's resolve to bring inflation back to its 2 percent target, arguing that a failure to restore price stability would mean "far greater pain."

U.S. equity futures slid along with Asian stocks amid weak risk sentiment.

The dollar hit a five-week high against the yen while gold held a decline, as bond yields ticked higher amid bets for more aggressive rate hikes in the United States and Europe.

Yields climbed across the U.S. and Europe, with double digit gains in Italy, Spain and Portugal.

Futures are now pricing in around a 60 percent chance the Fed will hike by 75 basis points at the Sept. 20-21 policy meeting.

Additionally, a Reuters report said the ECB could discuss a 75 basis-point hike at its September meeting.

Oil prices were little changed in Asian trading after rising sharply last week on speculation that OPEC+ could cut output at a meeting on Sept 5.

Closer home, benchmark indexes Sensex and the Nifty fell more than 1 percent each last week to snap their five-week winning streak.

The ongoing week is a truncated one, with stock exchanges BSE and NSE likely to remain shut on Wednesday on account of Ganesh Chaturthi.

Mukesh Ambani's Reliance Industries is all set for its 45th annual general meeting today, with investors expecting a succession plan and an announcement on the listing of three key businesses.

Monthly auto sales data and a slew of economic data will be in focus as the week progresses.