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The Dow industrials and the S&P 500 closed higher on Monday for the fourth consecutive trading session, as investors responded to an unexpected oil-production cut announcement by Saudi Arabia and its allies over the weekend.
U.S. oil futures surged over 6% and ended above $80 a barrel on Monday, following Saudi Arabia and its OPEC+ allies’ decision to remove over a million barrels a day from the market starting in May.
According to reports from the Financial Times, the Saudis were displeased after the White House stated that it had no intentions of refilling the U.S. Strategic Petroleum Reserve.
This surprise production cut by Saudi Arabia and its OPEC+ partners could potentially complicate the outlook for stocks, bonds, and currencies, while also undermining the efforts of the Federal Reserve and other central banks in combating inflation.
Provisional data released by India’s finance ministry revealed that the government collected Rs 16.61 lakh crore in direct taxes for the fiscal year 2022-23, marking a 17.6% increase compared to the previous year’s collection. This amount also slightly surpassed the revised estimate of Rs 16.5 lakh crore provided in the Union Budget for 2023-24 by 0.7%.
U.S. stocks experienced a decline on Tuesday, with the Dow and the S&P 500 index ending a four-day winning streak, as investors assessed new declines in factory orders and data indicating a softening labor market ahead of Friday’s jobs report, and its potential implications for recession concerns and interest rates.
Labor Department data showed that the number of job openings in the U.S. fell to a 21-month low in February, while orders for manufactured goods dropped for the third time in the last four months, slightly exceeding the 0.6% expectation from economists surveyed by The Wall Street Journal with a 0.7% decrease in February.
In his annual letter to shareholders, Jamie Dimon, Chief Executive Officer of J P Morgan Chase & Co., warned that the U.S. banking crisis that caused market volatility last month will have long-lasting effects felt for years, resulting in a decline in bank stocks.
The Indian Government has eliminated the windfall tax on crude oil, which was previously set at ₹3,500 per tonne, effective from Tuesday. Additionally, the tax on diesel has been halved to 0.5 rupee per litre.
The World Bank has revised its forecast for India’s economic growth in the current fiscal year that began on April 1, lowering it to 6.3% from the earlier projection of 6.6%, citing the expected impact of higher borrowing costs on consumption.
Gold prices remained near record highs witnessed in 2020, trading steadily above the key $2,000 level on Wednesday, as the dollar weakened due to weak U.S. economic data, leading to expectations of potential loosening of the Federal Reserve’s monetary policy trajectory.
The Reserve Bank of New Zealand raised its benchmark cash rate by 50 basis points to 5.25%, causing the New Zealand dollar to strengthen by nearly 0.9% in response.
Asia-Pacific markets showed mixed results on Wednesday as Wall Street digested a crucial U.S. labor report that revealed job openings had dropped to their lowest level in nearly two years in February.
The Nifty ended slightly higher on the first day of the new fiscal year after a volatile trade within a mild range.
The Nifty closed at 17398.1, up 0.22% or 38.3 points. After spending a significant portion of the day in negative territory, the Nifty managed to close in positive territory.
The 17529-17574 band could provide resistance, while 17207 could offer support. Improved volumes are necessary for the markets to sustain their recent gains.