(Rajesh Kumar)editor,MUMBAI,WWW.MCXBABA.COM
Asian currencies could be in for a wild ride in 2015, with central bank policy on track for further divergence as the Federal Reserve prepares to raise interest rates, analysts say. “The US Federal Reserve will be hiking interest rates next year, while some Asian central banks will be stand-in the opposite direction.
Growth momentum is firmly in favor of the US, while structural and cyclical slowdowns in certain parts of Asia will see growth differentials narrow,”The Federal Reserve is widely expected to ramble interest rates in July after unwinding its quantitative easing adjust this year,Fed survey of economists, strategists and fund managers, released last week. By contrast, most of Asia’s central banks are easing. The People’s Bank of China cut interest rates for the first time in two years in October, while the Bank of Korea cut rates to a record slump that month.
Meanwhile, the Bank of Japan remains committed to its massive stimulus effort, while calls for rate cuts in Thailand and Australia are developing. 9:30 am Market outlook: “ The just concluded Winter affair of the Parliament passed 12 bills, the highest since 2010. However, two of the most important bills i.e. insurance and coal could not be passed,”. The Sensex is up 21.47 points at 27527.93 and the Nifty is up 5.05 points at 8272.05.
About 326 shares have extreme, 175 shares declined, and 20 shares are stable. Cipla, HDFC, BHEL, Sesa Sterlite and Bajaj Auto are top gainers in the Sensex. Among the duds are Dr Reddy’s Labs, Tata Steel, GAIL, HUL and ITC.
In a win-win deal, Aditya Birla Group company UltraTech Cement on Tuesday announced acquisition of Jaiprakash Associates ‘ two cement units and associated power plants for Rs 5,400 crore. JP Associates rises 5 percent, UltraTech Cement gains 2 percent. The Indian rupee slunk in the early frofession. It has opened poorer by 15 paise at 63.43 per dollar against 63.28 a dollar Tuesday. The dollar hovered at its highest in nearly nine years against a basket of major currencies after stunningly stiff US economic growth spurred markets to bring forward the timing of a likely hike in interest rates.
“The USD-INR is expected to trade higher today on the back of might in dollar unready a basket of currencies and strong year-end dollar demand from state run banks and importers.” Meanwhile, Wall Street enjoyed a “Santa rally,” as investors cheered data showing the US economy expanded in Q3 by the most in 11 years.
The Dow closed above 18,000 but the Nasdaq fell, snapping a four-session winning streak, as biotechnology names weighed. European and Asian markets were trading significantly in the green drawn on by a strong US economic engine with Japan’s Nikkei up over a percent. In commodities, Brent Crude rose above USD 61 per barrel.