Indian shares are set to open lower on Friday, with sentiment unsettled as escalating U.S.-Israeli hostilities with Iran fuel fears of a deeper energy supply shock that could push crude higher, reignite inflation and cloud the global growth outlook.
The Gift Nifty futures were trading at 24,649 points as of 8:10 a.m. IST, indicating that the benchmark Nifty 50 will open below Thursday’s close of 24,765.9.
Both Nifty and Sensex rose about 1.1% each on Thursday, in a partial pullback after this week’s sharp selloff sparked by the Middle East crisis.
Markets showed signs of stabilising in the last session, but intensifying war in the Middle East for the sixth day has kept crude prices elevated, fuelling near-term inflation concerns and risk aversion, two analysts said.
Asian shares fell 0.7% at the open, while Wall Street closed lower overnight and the U.S. dollar firmed as hostilities involving the United States, Israel and Iran deepened.
Iran launched a wave of missiles at Israel and warnedit would target Americans “wherever they are” after a U.S. strike on a ship well outside the main battle zone.
Meanwhile, U.S. President Donald Trump saidWashington has a role in determining who leads Iran next, as American and Israeli jets continued their strikes in the region.
Brent crude jumped about 5% to a 20-month high $86.28 a barrel on Thursday, and was trading at $84.2 as of 8:10 a.m. IST.
A sustained rise in Brent would pressure India, which imports most of its crude, by lifting fuel and transport costs, adding to inflationary risks, widening the current account and fiscal deficits, and weighing on the rupee.
Indian refiners are buying millions of barrels of prompt Russian oil to navigate the supply crunch triggered by the near-complete shutdown of the arterial Strait of Hormuz, Reuters reported, citing source, after the U.S. issued a 30-day waiver allowing purchases of Russian oil.
Stocks to watch
- Dr Reddy’s Laboratories receives establishment inspection report from the US drug regulator for its Srikakulam facility classifying it as voluntary action indicated
- Garden Reach Shipbuilders signs a deal with Kalyani Strategic Systems to jointly develop advanced naval systems, unmanned platforms and maritime capabilities
- MRPL says it has not declared any “Force Majeure” and says reports of the company halting fuel exports are incorrect