Gift Nifty Points to Flat-to-Mildly Positive Open for Markets on Tuesday 

Mumbai, Aug 3: Gift Nifty futures held on to gains through Monday’s session, suggesting Nifty 50 and Sensex are likely to open flat-to-mildly positive when Indian markets reopen at 9:15 am on Tuesday, August 4. Investors continued to track the Iran-US conflict and its impact on crude oil prices, after US President Donald Trump said fresh talks with Tehran would take place later on Monday. 

The near-month August 25 contract of Gift Nifty was trading at 24,665.00, little changed on the day compared to its previous close, even as it swung within a wide range through the session. The broadly flat close, following a sharp intraday rally and a partial pullback, points to Indian benchmarks opening near current levels on Tuesday, with traders watching for cues from Monday’s Iran talks. 

Gift Nifty Intraday Chart 

It opened Monday’s session at 24,499, slipped to an intraday low of 24,452.5 in early trade, before rallying through the morning to a high of 24,696 around midday. It eased off through the afternoon to settle near 24,665. Support for Tuesday’s trade is placed at 24,452.5, while resistance is at 24,696. We expect Indian benchmark indices to open between these two levels, tracking Gift Nifty’s pullback from the day’s high. 

Iran-US Conflict 

The stand-off over Iran’s nuclear programme remained unresolved on Monday, with Trump saying talks with Tehran would take place later in the day, even as he declined to set a deadline for a final agreement. Trump had said over the weekend that Iran and other Middle Eastern countries had asked for more time to finalise a deal that would lead to a complete reopening of the Strait of Hormuz and an end to Tehran’s nuclear ambitions, while insisting Iran must move quickly. Iran’s Foreign Minister Abbas Araghchi held phone calls with his Saudi and Pakistani counterparts over the weekend, even as Tehran’s separate negotiations with Oman over an alternative shipping route through the strait were reported to be in their final stages. Israel struck a more cautious note, with Energy Minister Eli Cohen saying the country would act against any Iranian attempt to revive its nuclear or missile programmes regardless of whether a deal was reached. 

Crude Oil Prices 

Crude oil prices tumbled more than 4 per cent on Monday after Trump held off on a fresh attack on Iran in favour of a fresh round of talks aimed at reopening the Strait of Hormuz. Brent crude futures slid 4.64 per cent to 83.85 dollars a barrel, while US benchmark West Texas Intermediate fell 4.74 per cent to 80.66 dollars a barrel. Both contracts had surged more than 20 per cent in July as fighting between the US and Iran escalated and attacks on tankers near Oman kept shippers wary of entering the Gulf. 

Gains on Indian markets may remain capped ahead of Tuesday’s open, even with oil prices easing, as investors stay watchful of how Monday’s Iran talks conclude. Should the talks proceed without fresh escalation and crude oil prices sustain their decline, our forecast of a flat-to-mildly-positive open for Indian equity benchmarks on Tuesday would hold true; a breakdown in negotiations or a resumption of strikes near the Strait of Hormuz, however, could quickly reverse the mood and push Gift Nifty back towards its intraday lows. 

Present Nifty opening predictions are subject to change on the basis of news flow from Asian markets, fresh developments in the Iran-US crisis, or shifts in crude oil prices before Indian markets open at 9:15 am on Tuesday, August 4. 

Source

•  nseix.com