Sensex, Nifty Seen Tad Higher As US Default Concerns Ease

(RTTNews) - Indian shares may open a tad higher on Thursday as investors react to the passage of debt ceiling bill by the U.S. House of Representatives and domestic economic data released after market hours the previous day.

The bill to raise debt limit and cap government spending in the U.S. was passed by a wide margin on late on Wednesday.

The U.S. Senate must vote on the bill later this week before President Joe Biden can sign it into law.

Closer home, the Indian economy grew at a faster than expected pace in the three months to March 2023, preliminary data from the statistics ministry showed.

GDP grew 6.1 percent year-on-year, following a 4.5 percent growth in the previous three-month period. Economists had forecast growth of 5.0 percent. In the corresponding period last year, the economy had grown 4.0 percent.

However, separate data showed India's infrastructure output growth moderated further to 3.5 percent in April after hitting a five-month low of 3.6 percent in March. The core sector growth was 9.5 percent in April last year.

Adani Group stocks could be in focus today amid fund raising reports. In another development, auditor Deloitte has expressed concerns about Adani Ports' transactions with three unrelated firms.

Benchmark indexes Sensex and Nifty fell around half a percent each on Wednesday while the rupee closed flat at 82.72 against the dollar.

Asian markets traded mostly higher this morning as investors react to regional factory activity data for May. A private survey showed China's factory activity unexpectedly swung to growth from a decline in April.

The dollar fell from a two-week high against its major peers and gold traded in a tight range, while oil prices extended losses for a third consecutive session after data showed a large surprise in U.S. crude stocks.

U.S. stocks declined overnight as investors awaited a crucial vote on a bipartisan deal to suspend the government debt ceiling and set federal funding limits.

In economic releases, job openings rose unexpectedly in April, giving the Federal Reserve more reason to raise interest rates further if inflation stays high.

The Dow eased 0.4 percent, while the S&P 500 and the tech-heavy Nasdaq Composite both fell around 0.6 percent.

European stocks tumbled on Wednesday as investors fretted about China's uneven economic recovery and prospects of further interest rate hikes by the Federal Reserve and other leading central banks.

The pan European STOXX 600 dropped 1.1 percent. The German DAX and France's CAC 40 both lost about 1.5 percent while the U.K.'s FTSE 100 shed 1 percent.