Gift Nifty Points to Muted Opening on Monday Amid Iran-US Tensions

Mumbai, Sept 21: Indian markets are set to open on a muted note on Monday, even as Asian markets closed last week on a firm footing and Wall Street ended Friday’s session mixed, with crude oil extending its pullback from recent highs while still holding at elevated levels.  

Gift Nifty futures pointed to only a modest gain at the open, a far more tempered signal than the broad-based Asian rally that closed out last week, as investors stayed cautious ahead of a high-stakes UN General Assembly week in New York.  

Tensions in the Middle East simmered through the weekend after Iran’s central military command said Sunday it had received information suggesting the United States, backed by regional partners, could be preparing fresh military action against Tehran, warning that any such strike would trigger sustained retaliation against US bases and interests across the region.  

The accusation comes just two days before President Donald Trump is due to meet leaders of six Gulf nations on the sidelines of the UN `General Assembly, a meeting framed as central to deciding whether to escalate or wind down the standoff with Iran. Renewed Saudi-Houthi fighting in Yemen, including reported strikes near Mecca and an attack claimed on an Aramco facility in Yanbu, has added to the sense of a widening regional conflict even as oil prices eased on hopes that alternative export routes could keep crude flowing. 

Gift Nifty futures for the September 29 expiry were trading at 23,343.50, up 46.50 points, or 0.20 per cent, as of 7.23 am IST on Monday, suggesting Indian benchmarks could open with only marginal gains once trade begins at 9.15 am. The modest uptick follows Friday’s mixed close in the cash market and points to a cautious start to the week, with the size of the move well short of the sharper gains posted by several Asian markets heading into the weekend. 

Asian Markets on Monday Morning 

Asian markets closed last week’s final session broadly higher, setting a firm tone heading into the new trading week. South Korea’s Kospi led the region’s gainers on Friday, climbing 1.43 per cent, while Japan’s Nikkei advanced 1.38 per cent and Taiwan’s benchmark rose 0.69 per cent. Hong Kong’s Hang Seng and mainland China’s Shanghai Composite and Shenzhen Component also ended in positive territory, up 0.44 per cent, 0.41 per cent and 0.87 per cent respectively, while Australia’s ASX 200 was among the few laggards, slipping a marginal 0.1 per cent. The broadly firm close across the region stood in contrast to Gift Nifty’s far more subdued signal for Monday’s opening in India. 

Wall Street on Friday  

US markets ended Friday’s session mixed, with the Nasdaq gaining 0.4 per cent and the S&P 500 adding 0.17 per cent, while the Dow Jones Industrial Average slipped 0.18 per cent. The CBOE Volatility Index, or VIX, tumbled 4.08 per cent to 14.81, signalling a sharp easing in near-term risk perception even as the headline indices diverged. The mixed finish came as investors weighed the prospect of a US military response to Iran against otherwise resilient corporate earnings expectations. 

Oil Prices 

Crude oil prices extended their retreat, with Brent crude falling 2.22 per cent to $101.56 a barrel and WTI crude dropping 2.36 per cent to $97.93, even as both benchmarks remained well above levels seen earlier in the year. Murban crude, the key Gulf benchmark, slid 2.86 per cent to $117.92, while the Opec Basket tumbled 3.90 per cent to $119.20, reflecting hopes that alternative export routes could keep Middle Eastern supply flowing despite the renewed Saudi-Houthi fighting. Natural gas and gasoline also eased, down 1.44 per cent and 1.62 per cent respectively, though prices remained elevated relative to historical norms given the unresolved regional standoff. 

Indian Markets on Friday 

Indian equity benchmarks had ended Friday’s session mixed after the Closing Auction Session, with the Nifty holding on to gains to close at 23,346, up 76 points or 0.33 per cent, even as the Sensex pared almost all of a 245-point intraday advance to end just 20 points, or 0.03 per cent, lower at 74,295. The broader market significantly outperformed the headline indices, with the smallcap index jumping 1.7 per cent and the midcap index rising 1.2 per cent, while market breadth stayed firmly positive at 2,531 advances against 1,452 declines on the NSE. Metals, media, realty, infrastructure and energy stocks led the gains, each rising more than 1 per cent, even as the Nifty IT index fell 1.03 per cent and several Tata Group counters, including TCS and Tata Motors Passenger Vehicles, came under pressure amid the ongoing tussle over Tata Sons’ leadership and listing plans. The India VIX tumbled 7.2 per cent during the session, signalling a sharp easing in domestic market volatility heading into the new week. 

Source

•  nseindia.com