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Markets Likely To Extend Losses On Weak Global Cues

Japan’s Nikkei was down 0.7 per cent and South Korea’s Kospi index skidded 2.6 per cent.

The markets are likely to extend their previous day’s losses as the corona virus outbreak continued to rattle the global markets amidst worries about the economic impact of containing the deadly contagion. Trends on SGX Nifty indicate a negative opening in India. The Nifty futures were trading with a loss of 20 points or 0.1 percent. at 12,096 on the Singaporean Exchange.

In the overnight trade, US stocks suffered their worst day in over three months. The Dow Jones fell 453 points or 1.57 per cent to 28,535, the S&P 500 lost 51 points or 1.5 per cent to 3,243 and the Nasdaq Composite dropped 175 points or 1.8 per cent to 9,139.

Nearer home, the Asian shares slipped again on Tuesday as China took more drastic steps to combat the corona virus. MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.8 per cent in early Asian trading on Tuesday. Japan’s Nikkei was down 0.7 per cent and South Korea’s Kospi index skidded 2.6 per cent.

Oil prices slumped a further 2 per cent to multi-month lows on Monday as the rising number of cases of the new China virus and city lock-downs in major Chinese cities deepened concerns about demand for crude. Oil futures slipped on Tuesday, extending losses into a sixth session as the spread of the virus raised concerns about a hit to economic growth and slower oil demand. Brent crude was down 15 cents or 0.3 per cent to $59.17, after touching a three-month low at $58.50 on Monday.

On the news front, the US Fed will start its two-day monetary policy meeting later in the day. The US central bank is widely expected to expected to deliberate upon the balance sheet as its bond portfolio is swelling again at a rapid pace.

Back home, investors will track news flows surrounding the spread and impact of coronavirus, which has already claimed around 150 lives in China thus far. They will also react to the corporate earnings and continuing build-up of budget expectations.

Maruti Suzuki, Mahindra & Mahindra Financial Services, Mastek and Cummins India are some major companies to announce their December quarter results later in the day.

The Sensex had witnessed the second biggest fall in January on Monday, plunging 458 points to 41,155 and the Nifty 50 had dived 129 points to 12,119.

Source: NDTV Profit