Gift Nifty Signals Positive Opening For Markets on Wednesday

Mumbai, July 22: Indian equity benchmarks might open in the positive territory on Wednesday following firm Gift Nifty after US military announced that it had completed its latest, 11th straight night of attacks on Iran which eased off some of the acute war-related fears in the market. Asian shares were broadly firm on Wednesday morning with Japan’s Nikkei 225 surging higher, while Wall Street finished the overnight session with strong gains amid hopes. 

Gift Nifty futures on Wednesday were trading up by 13.50 points or 0.06 per cent at 24,117 as on 8.01 am IST indicating a positive start for Nifty 50 and Sensex. Gift Nifty’s near-month July 28 contract has been able to hold onto slight gains during the early morning session. It has extended its Tuesday’s steadier bias amid broader nervousness surrounding Iran war still remains intact. It also indicates that Indian indices might open a few points higher than their previous day’s closing levels. However, gains might remain capped as crude oil prices continue to hover at elevated levels. 

Iran War 

US military announced Wednesday that it had completed its 11th straight night of attacks on Iran earlier this week. US Central Command stated the recent attacks targeted Iranian military sites such as military operations centres, maritime capabilities, aircraft hangars, drone storage units and logistics facilities. “These precision strikes will impose costs on Iran for its attack on commercial ships,” CENTCOM spokesman Bill Urban said in a statement. “Iran continues to attack more than 30 commercial vessels transiting international waters in the Strait of Hormuz,” he added. 

In a separate report, US Defence Secretary Pete Hegseth said on Tuesday that the US’s conflict with Iran has cost the government $37.5 billion so far. The Pentagon’s war spending has increased by almost $8 billion since its last public estimate just two weeks ago. President Donald Trump has asked Congress for nearly $90 billion in extra funding since the start of the conflict with Iran. Most of that package was intended to pay for the war effort, as lawmakers from both parties pushed him to offer greater clarity about war plans. 

Asian Markets on Wednesday Morning 

Asian markets traded higher on Wednesday morning with Japan’s Nikkei 225 jumping up 1.93 per cent to 67,511.12 following conclusion of US strikes on Iran. Jakarta Composite soared 1.74 per cent and Shanghai Composite rose 0.22 per cent, while S&P ASX All Ordinaries of Australia and Pakistan’s KSE 100 traded higher. Hong Kong’s Hang Seng Index bucked the regional trend, down 0.91 per cent. Vietnam’s HNX 30 shed 0.97 per cent and Malaysia’s FBM KLCI gave up 0.34 per cent. Thailand’s SET index traded flat at 1,652.97 in early deals. 

US Markets on Tuesday 

US markets finished sharply higher on Tuesday on optimism over war. Dow Jones Industrial Average jumped up 385.38 points or 0.74 per cent to 52,224.64. S& P 500 rallied 65.92 points or 0.89 per cent to 7,509.20. Nasdaq Composite spiked 329.14 points or 1.29 per cent to 25,837.21 recording its biggest gain in weeks. “Tech has become decoupled from the economy,” said Matt Maley, chief market strategist at Miller Tabak + Co. “The markets are pricing in the view that the Fed will be able to cut interest rates again this year.” NYSE Composite surged 220.53 points or 0.93 per cent to 23,890.18. Mexico’s S&P/BMV IPC and Canada’s S&P/TSX Composite both gained ground too, ending 0.89 per cent and 1.17 per cent higher. 

Oil Prices 

Brent crude futures climbed 0.55 per cent or 50 cents to $91.51 per barrel and US West Texas Intermediate crude advanced 0.36 per cent or 30 cents to $84.64 per barrel to trade in thin volumes. Both benchmarks pared early losses and settled at a five-week high on Tuesday after US forces targeted Iran’s military installations in southern and western parts of the country in response to Iran firing missiles at US bases in Bahrain, Kuwait and Jordan. Traders also worried after Kuwait announced Iranian drone attacks for the second day. As tensions continue to escalate between Washington and Tehran, the Bab el-Mandeb Strait has become more important for Saudi crude exports due to a steep decline in vessels passing through the Strait of Hormuz. Data from American Petroleum Institute showed crude oil and distillate inventories increased last week while gasoline inventories dropped. Awaiting official government data later today. 

Indian Markets on Tuesday 

At home, benchmark Indian indices had declined on Tuesday led by Sensex which dropped 238.41 points or 0.31 per cent to 77,470.11 and Nifty 50 ended with a loss of 50.80 points or 0.21 per cent below the 24,200-level to close at 24,187.70. Persistent foreign selling coupled with higher crude oil prices and weakness in HDFC Bank dragged the markets during the session. Nevertheless, market participants witnessed a fairly balanced session on the domestic front with 2,087 shares advancing versus 1,942 losers and 180 trades remaining unchanged. Sectoral pullback also added to the negative move with Cipla witnessing the maximum decline among Nifty50 stocks, down nearly 2 per cent. IT leaders Tata Consultancy Services and Infosys along with auto stocks Maruti Suzuki and Tata Motors dropped around 1 per cent each. 

Source

•  nseindia.com