Sensex, Nifty Seen Opening Higher On Firm Global Cues

Indian shares are seen opening higher on Monday even as the elevated rate of inflation in the United States raised concerns that the Federal Reserve will accelerate the pace of tapering its asset purchases this week.

Participants will react to the IIP data, which showed India’s industrial output grew 3.2 percent on a yearly basis in October, after rising 3.3 percent in September. Production advanced 4.5 percent in the same period last year.

News flow on the new Covid-19 variant as well as the release of domestic inflation data and trade figures may sway sentiment as the week progresses.

Lat week, benchmark indexes Sensex and the Nifty clocked a second straight weekly gain, led by financial, oil & gas, auto and metal shares.

Asian markets were broadly higher ahead of a slew of central bank meetings lined up this week, including the Fed, the European Central Bank and the Bank of England.

Omicron remained a concern with the British Prime Minster warning of a “tidal wave” of new cases of the coronavirus variant.

The dollar held steady while oil prices rose on optimism that the new coronavirus’s impact will be limited on global fuel demand. Bitcoin held around the $50,000 mark.

U.S. stocks rose on Friday after data sowed U.S. consumer inflation rose 6.8 percent annually in November, reflecting the biggest jump since June of 1982 amid supply chain snarls and shortages. Traders seemed relieved somewhat that the price growth was not even faster.

A separate report showed consumer sentiment in the U.S. unexpectedly improved in early December.

The Dow rose 0.6 percent, the tech-heavy Nasdaq Composite added 0.7 percent and the S&P 500 advanced 1 percent to close at a fresh peak.

European stocks gave up early gains to settle lower on Friday as investors digested the latest economic readings from the region and the U.S.

The pan European Stoxx 600 declined 0.3 percent. The German DAX slipped 0.1 percent, France’s CAC 40 index eased 0.2 percent and the U.K.’s FTSE 100 dropped 0.4 percent.