Asian Markets Slide, Nasdaq Futures Dip as Global Cues Signal Weak Start for Dalal Street

Mumbai, May 19: Asian markets traded mixed on Tuesday as investors weighed easing geopolitical tensions in the Middle East against persistent concerns over elevated oil prices, and inflation, factors that are likely to keep Indian equities volatile at the open.

Asia Falls

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.07%, while South Korea’s Kospi fell 4.26%. Japan’s Nikkei declined 0.64% even as US President Donald Trump paused a planned military strike on Iran, raising hopes of a possible diplomatic breakthrough. Hong Kong’s Hang Seng was up 0.15%. Brent crude oil eased nearly 2% to around $110 a barrel after Tehran floated a peace proposal, although markets remained cautious after recent drone attacks in the Gulf region.

Despite the temporary relief in oil prices, global investors continued to worry about inflationary pressures and rising borrowing costs. The benchmark US 10-year Treasury yield was at 4.5974%, after touching its highest level since early 2025. Markets increasingly fear that central banks may have to maintain a “higher-for-longer” interest rate stance if energy prices remain elevated.

US Lower

Wall Street ended mostly lower as rising yields and oil-linked inflation worries pressured equities. Also, Nasdaq futures declined 0.37% as investors reassessed lofty AI-driven valuations amid a spike in global borrowing costs.

Europe Stressed

European markets too remained under stress. The pan-European STOXX 600 initially fell sharply before recovering to end 0.5% higher in a volatile session. Inflation worries linked to surging energy prices and the ongoing Iran conflict kept sentiment fragile, even as select stocks such as Publicis, Deutsche Boerse and Ryanair posted gains. Germany’s bond yields climbed to multi-year highs, underscoring fears of tighter monetary conditions across the region.

Weak Opening

Back home, Indian markets are expected to open weak, tracking Asian cues and persistent concerns around crude oil prices and foreign fund flows. Elevated oil prices remain a key risk for India given its dependence on imports, with the recent jump in global yields also weighing heavily on the rupee. The Indian currency hit a record low against the dollar on Monday.

Investors focus through the day will remain on crude oil movement, bond yields, geopolitical developments in the Middle East and upcoming global cues, particularly earnings from AI heavyweight Nvidia, which could influence broader risk appetite across global equities.

Source: Exchanges