Indian shares set for lacklustre start after U.S. data dampens mood

Rising odds of a U.S. Federal Reserve rate hike in May could set Indian shares for a flat start to Monday, after domestic markets rose following a surprise pause in rate hikes by the Reserve Bank of India last week.

The Nifty 50 has risen in each of past five sessions, up nearly 4% during the period. Investors await the corporate earnings for the quarter-ended March, scheduled to begin this week.

India's NSE stock futures listed on the Singapore exchange were down 0.06% at 17,705 as of 8:00 a.m. IST.

Wall Street equities rose on Thursday in a truncated week, ahead of U.S. jobs data, which was released on Friday.

Data indicated that the labour market remained tight in March, but was largely in-line with expectations and increased the probability of a Fed rate hike in May.

The market is pricing in 68.3% chance of a 25 basis point rate hike in May, up from 49.2% on Thursday, according to CME's FedWatch Tool. [.FEDWATCH]

Asian markets are off to a subdued start to the week. [MKTS/GLOB]

The surprise pause in rate hike and the upgrade to FY2024 growth forecast by the RBI on Thursday is seen as a positive by analysts.

"Rate pause and encouraging domestic data continues to provide positive undertone to the market," said Siddhartha Khemka, head – retail research, Motilal Oswal Financial Services.

India's consumer inflation likely eased in March to 5.80%, dipping below the RBI's upper tolerance limit for the first time in 2023, according to a Reuters poll of economists. The data is due on Wednesday, post market hours.

Meanwhile, foreign investors extended their buying streak to the sixth session in a row on Thursday, adding 4.76 billion rupees ($58.18 million) worth of equities.

Stocks to Watch:

** Titan: Co's revenue grew by 25% YoY in Q4.

** Tata Motors: Group's global wholesales at 361,361 in Q4FY2023; JLR sales rise in fourth quarter as chip supply continues to recover.

** Adani Wilmar: Co sees volume growth of close to 14% YoY in FY2023.

** Rail Vikas Nigam: Co emerges as lowest bidder for project worth 3.78 billion Rupees.

($1 = 81.8180 Indian rupees)