Dalal Street Set for Strong Start as Shares Rally at Pre-Open

Mumbai, May 25: Indian shares traded way higher at pre-open suggesting a strong start for benchmark indices as as crude oil prices fell below the psychologically significant $100 per barrel on signs of progress in US-Iran peace negotiations.

Nifty 50 traded 1.03% higher while the Sensex climbed 1.09%, going in step with Gifty Nifty futures which traded at 23,910, which is significantly above Nifty’s Friday close of 23,719. 

Spotlight will be falling on aluminium producer Hindalco and Royal Enfield maker Eicher Motors as the companies announced their results on Friday, with Hindalco surprising with a decline in profit for the March quarter due to costs arising from a disruption, and Eicher Motors exceeding estimates for profit. 

Also, Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp will be in focus as the state-owned fuel retailers have raised fuel prices a fourth time, going by reports. 

As for global cues, Asian markets rallied strongly on Monday, US stock futures climbed and oil prices slipped sharply, signalling a positive opening for Indian equities as investors welcomed signs of progress in US-Iran peace negotiations and easing concerns around disruptions in the Strait of Hormuz.

Japan spearheaded gains in the region, with the Nikkei jumping 3% to fresh record highs. Trading volumes across Asia remained relatively thin as markets in Hong Kong and South Korea were shut for holidays. Meanwhile, MSCI’s broadest index of Asia-Pacific shares outside Japan rose more than 1%.

Investor sentiment improved after US President Donald Trump said a memorandum of understanding to reopen the Strait of Hormuz had been “largely negotiated,” raising hopes that tensions in the Middle East could ease further.

The improving geopolitical outlook sparked a sharp decline in oil prices, with Brent crude falling more than 4% to slip below the key $100-per-barrel mark. The drop in crude is viewed as favourable for India, which imports the bulk of its oil requirements, as it helps ease concerns around inflation, fiscal pressures and higher import costs.

Softer crude prices are expected to support sectors such as oil marketing companies, aviation, paints, tyres and other fuel-intensive industries, while also lifting broader macroeconomic sentiment.

US futures also mirrored the upbeat mood, even though Wall Street remains closed on Monday for the Memorial Day holiday. Nasdaq futures gained about 1.3%, while S&P 500 futures rose around 0.8%, extending Friday’s gains on expectations of easing geopolitical tensions and steady corporate earnings momentum.

During Friday’s regular session, US investors gravitated back toward risk assets despite lingering worries over sticky inflation and elevated Treasury yields. The Dow Jones touched an intraday record high, while technology stocks continued to draw support from optimism surrounding artificial intelligence-led growth.

Source:

• Exchanges