The US stock futures traded flat Sunday night post 3 major indexes saw 7th consecutive weekly gains. The Dow Jones Industrial Average saw a new intraday record, with Nasdaq 100 seeing a new closing high. Futures associated with Dow industrials saw the addition of ~34 points, or 0.1%. S&P 500 futures moderately increased by 0.1%, with Nasdaq 100 futures increasing by ~0.02%. Winning momentum for S&P 500 index saw longest string of weekly gains since the year 2017. Market index was up by ~3.3% for the month, with Dow and Nasdaq increasing ~3.8% and ~4.1%, respectively.
These increases were supported by positive investors’ sentiments last week post the US Fed’s hints regarding 3 short-term interest rate cuts which are expected in 2024 amid cooling down of inflation. Slowdown in inflation, lower growth expectations, and steady growth momentum collectively appear positive from market perspective.
Current winning streak appears to be on similar lines to 2017-2018 market rally, where bullish sentiment resulted in disappointment in January. Therefore, for first time in 2H, investors continue to be cautious about positive momentum. On the economic front, traders and experts will eye December’s business leaders survey along with housing market index results. Monday will be the starting of final full trading week of this year.
Elsewhere, this positive momentum was seen in Indian equities too. FPIs kicked off December on positive note after they finally reversed selling streak seen in the month of November. As a result of this, FPIs have emerged as net buyers in overall Indian stock market.
While US stock futures traded flat, Indian equities are all set for the positive week ahead as foreign inflows have intensified due to strong global cues. The US Fed raised expectation s of rate cut in the month of March 2024. Therefore, this resulted in crash in US bond yields, triggering foreign fund inflows in emerging markets such as India.
As per National Securities Depository Ltd (NSDL) data, FPIs purchased INR42,733 crore worth of Indian equities, with total inflow coming at INR51,787 crore as at December 15, considering debt, hybrid, debt-VRR, and equities. Analysts believe that FPIs heavily purchased stocks catering to sectors such as banking and IT segments. Indian economy saw the growth of ~7.6% during July-September quarter for 2Q24, and was the fastest-growing major economy globally as per GDP data released by statistics ministry.
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