By RTT News, October 08, 2013, 11:01:00 PM EDT
(RTTNews.com) - Indian shares may drift lower on Wednesday, tracking weak global cues and as the International Monetary Fund (IMF) cut its India's growth forecast to 3.75 percent in 2013 from 5.7 percent estimated earlier, citing slowdown in demand and weak manufacturing and services sector performance.
The key indexes Sensex and the Nifty rose less than half a percent each on Tuesday, with banks pacing the gainers, after the Reserve Bank of India lowered the marginal standing facility rate by 50 basis points to 9 percent with immediate effect, relaxing the emergency measures taken to stabilize the rupee in July. The rupee erased early gains to end unchanged at 61.79 per dollar.
In corporate news, Essar Projects secured a Rs.70-crore sewage treatment project from Jamnagar Municipal Corporation in Gujarat. Suzlon Energy's subsidiary REpower said it has launched its 3-MW turbine for the Canadian market.
Tata Motors has launched the CNG version of its small car Nano at Rs 2.52 lakh to Rs 2.77 lakh ex-showroom Mumbai. Software and education company Compucom Software has secured a contract worth Rs 158.50 crore from the Rajasthan government for providing IT education in secondary schools of the state.
<b>Asian Markets </b>
Asian stocks are trading mixed on concerns a U.S. government debt default would prove more unpredictable to financial markets. The U.S. economy risks a "very deep recession" echoing the 2008 financial crisis if Congress doesn't raise the $16.7 trillion debt ceiling, U.S. President Barack Obama said at a news conference at the White House.
In its latest World Economic Report, the IMF cut its global growth forecast for this year to 2.9 percent from 3.1 percent seen in July. The outlook for 2014 was lowered to 3.6 percent from 3.8 percent.
Obama will nominate Federal Reserve Vice Chair Janet Yellen to succeed Ben Bernanke as chairman of the U.S. central bank when Bernanke's term expires on January 3, White House officials confirmed on Tuesday evening, ending weeks of speculation that Yellen has been a favorite candidate for the Fed.
The U.S. corporate earnings season kicked off in earnest yesterday, with aluminum giant Alcoa Inc. reporting better than expected earnings despite lower sales and weak metal prices.
Hong Kong's Hang Seng is down 0.7 percent, Indonesia's Jakarta Composite is edging down 0.1 percent, Malaysia's KLSE is losing 0.3 percent, New Zealand's NZX-50 is declining 0.4 percent and the Taiwan Weighted average is moving down 0.4 percent, while the markets elsewhere are posting modest gains. Japan's Nikkei index is rising 0.4 percent amid a weaker yen. South Korea's market is closed for a public holiday.
<b>U.S. And European Markets </b>
U.S. stocks extended losses overnight, with a lack of progress in ending the fiscal impasse weighing on the markets. The Dow lost 1.1 percent, the tech-heavy Nasdaq tumbled 2 percent and the S&P 500 dropped 1.2 percent.
House Speaker Boehner continued to press the Democrats to come to the table and work with Republicans, arguing that Democrats' refusal to negotiate is putting the country on a dangerous path. President Obama reiterated that he will negotiate with the GOP but only after short-term spending and debt limit bills are passed. He urged the Speaker to hold a vote on the Senate-passed bill that would re-open the federal government immediately.
European stocks also fell sharply on Tuesday as the U.S. government shutdown entered its second week and investors digested disappointing German factory orders and Chinese service sector data. The Bank of France cut its estimate for third-quarter GDP growth given the lack of improvement in business sentiment in the backdrop of weaker-than-normal order book levels. The German DAX slid 0.4 percent, France's CAC 40 shed 0.8 percent and the U.K.'s FTSE 100 fell 1.1 percent.
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