Nifty futures, Asian indices up; Wall St slides

Hong Kong: Indices across Asia are drifting down after a mildly positive start, after trade data from China showed that the surplus widened more than expected.

As at 7.30 am IST, Nifty futures are up by about two-tenths of 1 percent, and still below the 5300 mark. Elsewhere across the region too, indices have given up some of their early morning gains, which came despite a weak day on Wall Street.

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Markets are a bit volatile this morning, perhaps because they can’t make sense of the state of health of the global and regional economies. China’s trade surplus widened, but that’s more a function of the fact that domestic consumption is not picking up as much as had been expected.

On Wall Street overnight, earnings outlook dimmed, dragging down all three leading indices. The expectation that the US Fed will step in with QE3 is gaining ground; markets typically love that kind of talk, which opens up the possibility of more liquidity, but so far it hasn’t gained any traction.

Back home, the earnings season gets under way, and could determine investor sentiment in the absence of strong global cues. The monsoon outlook is, however, not looking good, with fears of a full-fledged drought growing. The rupee’s continued weakness, which will likely extend to today, is a drag on sentiment too.

Overall, we’re probably looking at a mild positive start to the trading day.