Market Ahead, December 13: Top factors that could guide markets today

Domestic markets may extend Thursday's rally, and could see a higher opening today as investors could look at positive global cues to steer through the trade. The gains, however, could be trimmed on concerns over rising retail inflation.

On Thursday, US President Donald Trump said Washington and Beijing are very close to signing a “big” trade deal that’s expected to see him reduce existing tariffs and delay ones due to take effect on Sunday, December 15. As per reports, Trump has already signed off on an initial trade agreement with China. 

Consequently, US stocks hit record highs during the overnight trade yesterday. The Dow Jones ended up 0.79 per cent, while the S&P 500 gained 0.86 per cent, and the Nasdaq 0.73 per cent.

Asian shares, too, were charging ahead during the early trade on Friday. MSCI’s broadest index of Asia-Pacific shares outside Japan put on 0.5 per cent. Japan's Nikkei climbed 2.1 per cent to a 14-month high, while South Korean stocks firmed 1.2 per cent. 

Besides, In the UK, exit polls suggested that Prime Minister Boris Johnson’s Conservative Party looked to have won a clear majority in the UK elections which would give Johnson the power to push through Brexit.

Back home, however, India's retail inflation rose to 5.54 per cent in November, largely on the back of rising food prices, which could dampen sentiment at D-Street. That apart, industrial output contracted 3.8 per cent in October against a 4.3 per cent contraction in September. 

India's Wholesale inflation and trade figures for November are scheduled to be released later today.

Additionally, participants may react to this Business Standard report that the Centre is considering increasing the government bond investment limit of foreign portfolio investors to at least 10 per cent of the outstanding, from 6 per cent now, with an aim to incorporate local bonds into global bond indices. 

On Thursday, the S&P BSE Sensex added 169 points or 0.42 per cent to end at 40,582. The NSE's Nifty50 index ended at 11,972, up 62 points or 0.52 per cent.