the RBI’s monetary policy to steer the markets; banks, automobile, real estate actions in brief

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MUMBAI: The Reserve Bank of India’s monetary policy review is expected to steer markets on Friday. SGX Nifty trends suggest a weak opening in Indian benchmarks. Both benchmarks hit record closing highs on Thursday. The BSE Sensex gained 382.95 points or 0.74% more to 52,232.43. The Nifty gained 114.15 points or 0.73% to 15,690.35.

It is generally expected that the RBI will not change policy rates. Comments from the central bank on growth and inflation would be closely watched. The market expects the central bank to expand its bond buying program in the second quarter of the fiscal year with the addition of another 1 to 1.5 trillion, said Saugata Bhattacharya, chief economist at Axis Bank.

Rate sensitive stocks like banks and financials, autos and real estate will be in the spotlight today.

Punjab National Bank, Bharat Forge, Bank of India, NIIT and Jammu Kashmir Bank, key companies that will report their March quarter results today.

Britannia Industries said on Thursday that its board of directors had approved a proposal to increase 698.51 crore by issuing free debentures to eligible shareholders.

Asian stocks followed Wall Street lower on Friday as signs of a strengthening recovery in the United States boosted bets on higher inflation and a faster reduction in Federal Reserve stimulus.

U.S. Treasury yields surged, pushing the dollar higher and hurting tech stocks, after better-than-expected employment data prompted expectations of a good nonfarm payroll reading overnight on Friday, while a measure of service sector activity has reached an all-time high.

On Wall Street, the S&P 500 lost 0.4%, while the Nasdaq Composite suffered a decline of 1%. The Dow Jones Industrial Average fared relatively better, slipping 0.1%.

U.S. stocks have gotten some relief as reports closed that President Joe Biden is ready to compromise on a proposed corporate tax hike.

The 10-year Treasury yield hit 1.6320% in Asia, after advancing nearly four full basis points overnight.

The dollar index kept Thursday’s 0.7% rally, its largest since April, to hover around 90.50.

While Fed officials have always said they expect current inflationary pressures to be transient and ultra-relaxed monetary policy to remain in place for a while, they are also increasingly touting the more the need to start at least to talk about a reduction in stimulus measures.

Gold remained weaker after falling 2% on Thursday, its strongest since February, amid a stronger dollar.

Crude oil retreated from highs more than two years ago on Friday after weekly US crude inventories fell sharply while fuel inventories rose more than expected.

Brent futures fell 0.4% or 25 cents to $ 71.06 a barrel, after hitting their highest level since May 2019 earlier in Thursday’s session. The US WTI slipped 0.3% or 23 cents to $ 68.58 a barrel, from $ 69.40 the day before, the strongest since October 2018.

(Reuters contributed to the story)

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