Indian benchmark indices Sensex and Nifty are likely to open on a mildly positive note on Tuesday. GIFT Nifty showed gains of 55 points, but Asian markets fell sharply. Higher retail inflation at 5.54 percent, rising crude oil prices, and Middle East tensions may cap gains for investors this week.
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Indian benchmark indices Sensex and Nifty are likely to open on a mildly positive note on Tuesday, with GIFT Nifty signalling gains despite a sharp selloff across Asian markets. However, India's higher-than-expected retail inflation, elevated crude oil prices and escalating Middle East tensions could weigh on sentiment. Expectations of further RBI interest-rate hikes also add to concerns over the domestic outlook.
GIFT Nifty was trading at 22,425 around 8 am, up 55 points, or 0.25 percent. Indian equities ended sharply lower on Monday, with the Sensex falling 547.65 points, or 0.76 percent, to 71,924.68 and the Nifty declining 157.10 points, or 0.70 percent, to 22,363.35. Foreign institutional investors remained net sellers, offloading equities worth Rs 1,700 crore, while domestic institutions bought shares worth more than Rs 3,000 crore.
India's retail inflation rises to 5.54 percent
India's retail inflation accelerated to a higher-than-expected 5.54 percent in September, moving closer to the Reserve Bank of India's upper tolerance limit of 6 percent and strengthening expectations of further interest-rate hikes. The increase comes amid sustained pressure from elevated crude oil prices and a weak monsoon, with the Iran war, now in its eighth month, continuing to disrupt energy supplies and fuel inflation concerns.
The inflation reading follows the RBI's decision earlier this month to raise the repo rate by 25 basis points to 5.50 percent, its first increase since February 2023, and shift its policy stance to calibrated tightening. The combination of higher inflation and tighter monetary conditions could add to pressure on rate-sensitive sectors.
Share Markets Live Updates | Sensex, Nifty, Gift Nifty Today
Asian markets tumble as technology stocks lead losses
Asian equities fell sharply on Tuesday as technology shares came under heavy selling pressure amid escalating Middle East tensions, elevated crude oil prices and a stronger dollar. Investors are also turning cautious ahead of the corporate earnings season.
MSCI's broadest index of Asia-Pacific shares outside Japan declined more than 2 percent in early trading, while South Korea's technology-heavy Kospi plunged 6 percent. Japan's Nikkei fell 2.6 percent, reflecting broad risk aversion across regional markets.
Wall Street ends mixed, Nasdaq declines; Brent holds above $106 amid supply risks
US equities closed mixed on Monday, with technology shares weighing on the Nasdaq while the Dow Jones Industrial Average advanced. The Dow rose 195.60 points, or 0.38 percent, to 51,850.55, while the S&P 500 slipped 0.06 percent to 7,807.24. The Nasdaq Composite declined 0.44 percent to 27,245.90.
Crude oil prices edged lower on Tuesday after climbing nearly $2 a barrel in the previous session, although concerns over supply disruptions continued to keep prices elevated. Traders were weighing supply risks following attacks on Saudi Arabia against the prospect of additional diesel supplies from Russia. Brent crude futures fell 0.57 percent to $106.04 a barrel, while West Texas Intermediate declined 0.5 percent to $93.27 a barrel.