Asian Markets Slide, Wall Street Tech Jitters Weigh on Sentiment; Indian Equities Seen Opening Lower

Mumbai, June 5:Indian equities are poised for a lower start on Friday as Asian shares sliding, gains in crude oil prices and weakness in U.S. technology stocks weigh on market sentiment.

Asian Shares Slide

Asian markets slid as investors booked profits after AI rally and uncertainty loomed over developments in the Middle East and their potential impact on energy supplies. Market participants remained focused on the status of U.S.-Iran negotiations, with reports indicating that while diplomatic efforts continue, significant hurdles remain before any agreement can be reached.

Hong Kong’s Hang Seng went down 0.8% while MSCI’s broadest index of Asia-Pacific shares outside Japan declined 1.6%. South Korea’s Kospi was down 3.6% while Taiwan’s Taiex declined 0.8%. Japan’s Nikkei was down 1.2%.

Middle East uncertainty helped support oil prices, which rose about 0.8% on Friday after recovering from the previoussession’s losses. The move in crude kept investors cautious, particularly in import-dependent economies across Asia, where higher energy costs could rekindle inflationary pressures and weigh on corporate margins.

The broader risk mood remained subdued, with traders reluctant to take aggressive positions ahead of further clarity on geopolitical developments and the outlook for global growth.

Broadcom Slump Dents Technology Sentiment

Overnight, Wall Street delivered a mixed performance. The Dow Jones Industrial Average closed at a record high, supported by strength in financial and healthcare shares, while the broader S&P 500 edged higher.

However, sentiment in the technology space weakened sharply after semiconductor giant Broadcom tumbled following earnings that disappointed investors. The decline reverberated across chipmakers and artificial intelligence-linked stocks, dragging the Nasdaq lower and prompting investors to reassess valuations in a sector that has led global market gains for much of the past year.

Europe Shows Resilience Despite Geopolitical Concerns

The pan-European STOXX 600 index ended higher as investors looked beyond geopolitical risks and focused on company-specific developments.

Healthcare stocks provided support, while luxury goods shares also contributed to gains. Technology stocks, however, mirrored the weakness seen in the United States as investors reacted to Broadcom’s results.

Market participants also continued to monitor expectations for future monetary policy moves in the euro zone, though geopolitical developments remained a key source of uncertainty.

What It Means for Indian Markets

For Indian equities, the global setup points to a lower opening.

The rise in crude oil prices could weigh on sectors sensitive to fuel costs, including aviation, paints, tyres and oil marketing companies. Higher oil prices may also revive concerns about India’s import bill and inflation trajectory if the gains persist.

On the other hand, the weakness in global technology shares may keep investors cautious on frontline IT names such as Infosys, TCS, HCLTech and Wipro at the open.

Financial stocks will remain in focus ahead of RBI monetary policy, while defensives such as healthcare may remain in focus amid heightened geopolitical uncertainty.

Source:

• Exchanges