Gift Nifty Signals Positive Open for Sensex, Nifty on Wednesday

Mumbai, November 11: Indian markets are set for a gap-up opening on Wednesday, with Gift Nifty trading about 285 points above the Nifty 50’s last close. The cue comes from firm Asian stocks, crude below USD 93 and Trump’s pledge to hold off on fresh Iran strikes. Markets reopen after Tuesday’s Diwali-Balipratipada holiday. 

The near-month Gift Nifty contract was at 25,329.50 at 8.05 am, up 15.50 points, or 0.06 per cent, from its previous close. That is a premium of 284.85 points, or 1.14 per cent, to the Nifty 50’s Monday close of 25,044.65. The Sensex is expected to follow the Nifty higher. 

Brent crude is at USD 92.42 a barrel, up 1.02 per cent, and WTI is at USD 86.55, up 0.59 per cent. Both bounced after a steep fall on Tuesday. Cheaper oil remains a tailwind for India, a major importer. 

Asian stocks are mostly higher, led by Taiwan, up 2.09 per cent, and South Korea’s Kospi, up 1.47 per cent. Japan’s Nikkei is up 0.80 per cent, while Hong Kong’s Hang Seng is down 0.74 per cent. The strength in Tokyo, Seoul and Taipei supports a gap-up start in Mumbai. 

Wall Street ended lower on Tuesday, with the Nasdaq down 0.74 per cent, the S&P 500 down 0.38 per cent and the Dow Jones down 0.30 per cent. The Nasdaq fell the most of the three. The VIX volatility index, however, fell 2.31 per cent to 19.46. 

Trump has said he will hold off on new Iran strikes for now but will keep the naval blockade in the Strait of Hormuz. A deal is not close, as Washington has rejected Tehran’s truce plan. Attacks on tankers continue, keeping oil and the market exposed to sudden shocks. 

Oil Prices 

Brent crude rose USD 0.93, or 1.02 per cent, to USD 92.42 a barrel, while WTI gained USD 0.51, or 0.59 per cent, to USD 86.55, both bouncing after Tuesday’s sharp fall. Murban crude was quoted at USD 92.07 on November 10, down 7.16 per cent, while the OPEC basket slipped 1.31 per cent to USD 91.99. Natural gas rose 0.30 per cent to USD 3.306. 

Asian Stocks 

Asian stocks were mostly higher on Wednesday morning, with Taiwan up 2.09 per cent at 43,605.79 and South Korea’s Kospi up 1.47 per cent at 5,316.23. Japan’s Nikkei gained 0.80 per cent to 60,942.48, Singapore’s Straits Times rose 0.33 per cent to 5,276.02 and Australia’s ASX 200 added 0.16 per cent to 9,144. Hong Kong’s Hang Seng fell 0.74 per cent to 24,375.38, Malaysia lost 0.59 per cent to 1,594.63, and Shanghai slipped 0.22 per cent. Thailand’s SET was flat at 1,496.31. 

US Markets 

US stocks ended lower on Tuesday, with the Nasdaq Composite down 187.26 points, or 0.74 per cent, at 25,065.87 and the S&P 500 down 29.01 points, or 0.38 per cent, at 7,520.93. The Dow Jones Industrial Average fell 157.86 points, or 0.30 per cent, to 52,231.89. The Russell 2000 small-cap index dropped 0.68 per cent and the VIX fell 2.31 per cent to 19.46. 

Iran War 

Trump said on Monday he plans to hold off on new strikes against Iran for the time being after appeals from Qatar, Saudi Arabia, the UAE and other regional countries, Reuters reported. He will keep the naval blockade in the Strait of Hormuz and remains unwilling to accept Iran’s truce plan. Secretary of State Marco Rubio said a diplomatic breakthrough was not imminent, and a senior UAE official urged the region to prepare for a long period of uncertainty. Attacks continue, with Iranian media reporting US strikes on Qeshm island overnight and tanker attacks running at the highest rate since the war began on February 28. 

Monday’s Close 

Indian equity benchmarks ended modestly higher on Monday, with the Sensex up 107.25 points, or 0.13 per cent, at 81,106.65 and the Nifty 50 up 58.25 points, or 0.23 per cent, at 25,044.65. Both closed at their highest levels since February 27, after surging about 10.5 per cent over seven sessions through Friday. Public sector banks led, with the Nifty PSU Bank index jumping 3.7 per cent, while the Nifty IT index fell 1.2 per cent. State Bank of India (SBIN) rose 2.6 per cent and Trent (TRENT) 2 per cent, while Tata Steel (TATASTEEL) fell 2.8 per cent and HCL Technologies (HCLTECH) 2.4 per cent. 

Sources

•  NSE data
• BSE data
• CNBC
• OilPrice.com
• Reuters