Sensex, Nifty open on flat note; M&M, Asian Paints, HDFC bank major gainers

Mumbai: Benchmark indices opened on a flat note on Thursday (December 19). At 9:15 am, the Sensex is up 21.54 points or 0.05% at 41580.11, and the Nifty up 1.75 points or 0.01% at 12,223.40. Major gainers on the Indices include M&M, Asian Paints, HDFC bank and Dr Reddy's Lab, TCS, are among major gainers on the Indices, while Tata Steel, Tata Power, IndusInd Bank, ICICI Bank and Bharti Airtel are the top losers.

On Wednesday, Indian stock market continued to reap benefits from supportive global markets and strong inflow of foreign funds. The Sensex hit an all-time high of 41,615 while the Nifty touched a fresh high of 12,238 earlier in the day. Sensex closed 206.40 points higher at 41,558.57. The Nifty closed at 12,221.65, advancing by 56.65 points.

Asian shares pulled back from a one-and-a-half year peak on Thursday as investors booked profits ahead of holiday trade and awaited further data on the state of the global economy.

Investors were also watching proceedings in Washington where the Democrat-led US House of Representatives voted to impeach Republican U.S. President Donald Trump for abuse of power and obstruction of Congress.

Market reaction, however, has so far been limited as the Republican-controlled Senate is widely expected not to vote to remove Trump from office. 

MSCI`s broadest index of Asia-Pacific shares outside Japan briefly touched the highest since June 2018 but then fell 0.2%. Australian shares erased early gains to trade 0.14% lower due to declines in the mining sector, while Chinese shares drifted 0.06% lower.

The pound nursed heavy losses due to concerns Britain could still crash out of the European Union without a trade deal in place after a transition period ending in December 2020.

Traders also await a Bank of England (BoE) policy meeting later Thursday. No change in policy is expected, but the meeting could pose further downside risks for sterling if more policymakers swing to the dovish camp and vote for an interest rate cut.

Overall sentiment was supportive of equities and riskier assets, but less favourable for safe-haven assets like bonds due to expectations that economic growth will start to pick up next year after a tumultuous 2019.

US stock futures edged 0.02% lower in Asia on Thursday. The S&P 500 fell 0.04% on Wednesday, weighed by a steep drop in FedEx Corp shares after the US parcel delivery company cut its fiscal 2020 profit forecast.

In the currency market, sterling traded at $1.3089, having tumbled more than 3% from an 18-month high struck on Dec. 13 after UK Prime Minister Boris Johnson`s Conservative Party scored a landslide victory in a general election.

Against the euro, the pound stood at 85.03 pence, close to its weakest since Dec. 4.

Johnson`s government on Tuesday ruled out an extension to the December 2020 deadline for negotiations on a trade deal with the EU, creating a new Brexit cliff-edge and cutting short sterling`s post-election rally.

The BOJ is widely expected to keep its quantitative easing in place by may offer a gloomier assessment of factory output.

US crude dipped 0.03% to $60.91 a barrel in Asia after US government data showed a decline in crude inventories.

However, prices are likely to be supported due to production cuts coming from the Organization of the Petroleum Exporting Countries and its allies, including Russia.

(With Agency Inputs)