Global Macro Signals (03 October)
- GIFT Nifty holds steady ahead of cautious global tone: Futures are tracking sideways, reflecting uncertainty from overseas markets and lack of fresh domestic triggers.
- Markets bet on U.S. rate cuts amid shutdown jitters: A weak ADP jobs print and government gridlock are fueling expectations that the Fed may ease later this year.
- Asia opens mixed after Wall Street hits records: Gains in Nasdaq and S&P lifted sentiment, but regional participants remain selective given global risks.
- U.S. futures slip from peak levels: After record highs, futures are down modestly as traders take partial off exposure ahead of key data.
- 10-year U.S. yield eases toward 4.08 percent: The dip in yields offers relief to rate-sensitive sectors and helps support equity valuation.
- Dollar index subdued with mild softness: A slightly softer dollar helps emerging markets, giving India modest relief from currency headwinds.
- Gold corrects from record highs but holds defensive demand: Bullion gives up some gains, though safe-haven flows continue to underpin support.
- Brent crude recovers on supply fears: After recent pullbacks, oil prices inch up again amid OPEC uncertainty and supply risk perceptions.
- Rupee steadies amid muted FX moves: INR is holding near previous levels; dollar-rupee swaps surged on quarter-end flows, but spot remains contained.
- Foreign outflows persist, domestic support slows: FIIs remain net sellers; DIIs are less aggressive, leaving the market vulnerable to volatility.
// Market Outlook & Trade Setup
The tug between rate cut hopes and policy caution continues to define sentiment. In India, the sideways bias prevails unless global impulses swing hard. The flat bias in GIFT Nifty signals that early trade may lack directional vigor, keeping focus on flow cues and correlation with global indices. On the technical front, Nifty needs to clear resistance decisively to signal follow-through; otherwise, intra-day swings between support and resistance will dominate.
Implied volatility is elevated, pointing to an environment where intraday whipsaws are likely, though directional conviction is weak. As foreign capital continues exiting, the burden of stability lies with domestic institutions. Their activity can blunt dips, but may not fuel sharp rallies. Overnight F&O contract flow will matter: a build-up in long positions could cushion downside, while low participation may expose markets to sudden breaks.
Implied cues for open, direction, and trend: Expect a neutral to soft open unless surprise global catalysts emerge. The session is likely to remain range bound with mild bias toward downside unless support levels hold firmly. A sustainable trend reversal or breakout will depend on fresh foreign inflows or strong global impulses pushing through resistance.