The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to open higher but remain volatile on Monday amid mixed global market cues, as investors watch out for the latest developments in the US-Iran war which has entered its third week, and has led to a crisis in global oil markets.
Asian markets traded mixed, while the US stock market ended lower last week, on worries over the global oil supply disruptions due to the war in the Middle East.
This week, investors will focus on key stock market triggers, including the developments in the US-Iran war, US Federal Reserve meeting, global supply of crude oil amid the closure of the Strait of Hormuz, crude oil prices, FII flows, trends in gold and silver prices, and other key domestic and global macroeconomic data releases.
On Friday, the Indian stock market extended steep losses amid worries over the ongoing US-Iran war in the Middle East.
The crashed 1,470.50 points, or 1.93%, to close at 74,563.92, while the Nifty 50 settled 488.05 points, or 2.06%, lower at 23,151.10.
“Given the prevailing uncertainty and heightened volatility, participants are advised to maintain a cautious stance, keep position sizes light and focus on strict risk management while adopting a selective trading approach,” said Ajit Mishra – SVP, Research, Religare Broking Ltd.
Here are key global market cues for Sensex today:
Asian Markets
Asian markets traded mixed amid elevated crude oil prices and as investors assessed the latest developments in the escalating US-Iran war. Japan’s Nikkei 225 declined 0.12% and the Topix fell 0.11%. South Korea’s Kospi gained 0.95%, while the Kosdaq was flat. Hong Kong’s Hang Seng index futures indicated a higher opening.
Gift Nifty Today
Gift Nifty was trading around 23,359 level, a premium of nearly 160 points from the Nifty futures’ previous close, indicating a positive start for the Indian stock market indices.
Wall Street
US stock market ended lower on Friday as investors gauged how the war in Iran was affecting the global oil supply.
The fell 119.38 points, or 0.26%, to 46,558.47, while the S&P 500 declined 40.43 points, or 0.61%, to 6,632.19. The Nasdaq Composite closed 206.62 points, or 0.93%, lower at 22,105.36.
Nvidia stock price fell 1.59%, AMD shares declined 2.20%, Broadcom share price plunged 4.13%, Apple stock price dropped 2.21%, Meta shares fell 3.83%, Microsoft share price 1.58%, and Tesla stock price eased 0.96%. Adobe shares tanked 7.6%.
US-Iran War
The crossed the two-week mark, and the trade through the has come to an effective halt, pushing up energy prices around the world. US President Donald Trump said Washington is in contact with Iran but expressed doubt that is prepared for serious negotiations to end the conflict.
Meanwhile, the IDF launched a wave of “extensive strikes” targeting infrastructure of “the Iranian terror regime” in Tehran. Earlier, the US had bombed Iran’s Kharg Island, Iran’s main oil export hub, and also warned of further strikes on its oil infrastructure if needed.
US GDP Growth
US economic growth slowed more sharply than initially thought in the fourth quarter. US Gross Domestic Product (GDP) increased at a 0.7% annualized rate last quarter, revised down from the initially reported 1.4% pace. Economists polled by Reuters had forecast GDP growth would be unrevised at 1.4%. The economy grew at a 4.4% pace in the third quarter.
US PCE
US Personal Consumption Expenditures (PCE) price index, an inflation gauge closely monitored by the Federal Reserve, moved higher in January. The PCE price index increased 0.3% after rising 0.4% in December. In the 12 months through January, PCE inflation advanced 2.8% after rising 2.9% in December.
US Consumer Spending
US consumer spending increased solidly in January. Consumer spending, which accounts for more than two-thirds of economic activity, increased 0.4% after advancing by the same margin in December. Economists polled by Reuters had forecast consumer spending advancing 0.3%.
Crude Oil Prices
Crude oil prices fell, paring early gains after President Trump called on other countries to help safeguard the Strait of Hormuz, a vital artery for global oil and gas shipments. Brent crude futures fell 0.23% to $102.90 a barrel, while US West Texas Intermediate crude price slipped 1.08% to $97.64 a barrel.
Dollar
The dollar index eased slightly to 100.20, but remained perched near last week’s 10-month high. The Euro traded 0.14% higher at $1.1433, while Sterling was up 0.17% at $1.3245. The yen languished near the 160-per-dollar level and last stood at 159.44.
Gold Rate Today
Gold prices were steady after paring a near 1% fall earlier in the session amid a softer dollar. Spot gold price was unchanged at $5,017.53 per ounce, US gold futures for April delivery fell 0.8% to $5,020.90. Spot silver price rose 0.4% at $80.88 per ounce.
(With inputs from Reuters)