Indian Markets Set for Muted-to-Positive Open on Wednesday as Strong Asian Stocks Offer Support

Mumbai, Oct 21: Indian equity markets are set for a muted-to-positive open on Wednesday, as Gift Nifty futures point to a largely steady start while strong Asian stocks provide a firmer backdrop. Asian shares rose and bonds stabilised at the start of trading, following Wall Street’s gain, as early indications from the corporate earnings season pointed to strong profits for global companies and bolstered investor confidence. 

The improvement in global mood comes at a useful time for domestic benchmarks, which snapped a two-day winning streak on Monday after private sector banks and information technology stocks dragged the market lower. Indian exchanges were shut on Tuesday for Dussehra, so traders return after a break with a weaker September-quarter result from Axis Bank, elevated crude oil prices and a hardening Iranian stance on talks with Washington still on the radar. 

Strong overseas earnings may help investors look past some of that caution, though gains could stay limited if crude keeps climbing, with Brent trading above $110 a barrel and the Iran war showing no sign of a quick resolution. 

Gift Nifty figures 

Gift Nifty futures for October 27 were trading at 23,019.00, down 12.50 points or 0.05 per cent, as of 7:52 am IST on October 21. The level is about 130 points above the Nifty 50’s last close of 22,888.95, which suggests a modest positive start for the index. The marginal dip in the contract, however, tempers expectations of a sharp gap-up. 

Asian markets on Wednesday morning 

Asian stocks rose on Wednesday morning, with MSCI’s broadest index of Asia-Pacific shares outside Japan up 1.5 per cent, led by a 4 per cent gain for Korean shares. South Korea’s KOSPI jumped 4.33 per cent, or 240.59 points, to 5,793.33, while Japan’s Nikkei 225 climbed 1.25 per cent, or 802.90 points, to 64,878.32. Taiwan advanced 1.85 per cent to 47,150.65, while Hong Kong’s Hang Seng rose 0.28 per cent to 23,933.63. Among the decliners, Australia’s ASX 200 slipped 0.18 per cent to 8,801.40, while China’s Shanghai Composite eased 0.05 per cent to 3,733.54. 

US markets close on Tuesday 

Wall Street ended higher on Tuesday, with the Dow Jones Industrial Average gaining 529.85 points, or 1.02 per cent, to 52,495.88 and the S&P 500 rising 0.28 per cent to 7,712.57. The NYSE Composite added 0.93 per cent to 24,190.62, while the small-cap Russell 2000 outperformed with a 1.65 per cent gain to 2,773.42. The Nasdaq Composite was the outlier, slipping 0.02 per cent to 26,424.82. 

Oil prices 

Oil prices rose in early trade on Wednesday. Brent crude gained $1.58, or 1.45 per cent, to $110.37 a barrel, while US West Texas Intermediate was up $1.35, or 1.38 per cent, at $99.18 a barrel, as per OilPrice.com data with a 12-minute delay. Prices remain sensitive to the Strait of Hormuz, whose reopening Iran has tied to a list of demands. 

Iran war 

Iran told Pakistan’s army chief on Tuesday that there would be no talks with Washington until Tehran’s demands were met, Iranian media reported, underscoring a hardening stance despite mediation by Pakistan. President Masoud Pezeshkian discussed mediation efforts with Field Marshal Asim Munir, while parliament speaker Mohammad Baqer Qalibaf said Washington could not regain Tehran’s trust until it met seven conditions set last month for reopening the Strait of Hormuz, including an end to the US blockade on Iranian ports, the lifting of sanctions on oil exports and an end to hostilities on all regional fronts. Security chief Mohsen Rezaei delivered a similar message and said all enriched nuclear material would remain in Iran. US Vice President JD Vance said earlier this month that Iran must make a meaningful cut in its enrichment capacity to end the eight-month-old war, after an interim peace agreement reached in June unravelled within weeks. 

Sensex and Nifty last close 

The Sensex and Nifty 50 last closed on Monday, October 19, with the Sensex down 876.37 points, or 1.17 per cent, at 73,852.90 and the Nifty down 257.20 points, or 1.11 per cent, at 22,888.95, snapping a two-day winning streak. Profit booking after both benchmarks rallied around 3 per cent last week, their strongest weekly gains in six months, weighed on sentiment. The Nifty Private Bank index fell about 1.9 per cent, with Axis Bank (AXISBANK) sliding 4.2 per cent after its September-quarter profit narrowly missed estimates, while IT stocks also dragged. Breadth was negative, with 2,925 shares declining, 1,163 advancing and 181 unchanged, as the Nifty Midcap index fell about 1.1 per cent and the Smallcap index shed 1 per cent. 

Sources

•  Reuters
• CNBC (Asian markets)
• OilPrice.com
• PTI/market close report
• Gift Nifty screenshot