Indian Shares Decline At Pre-Open Signalling Negative Start As Oil Continues March Towards $100

Mumbai, September 9: Indian shares declined at pre open signalling a negative start for benchmarks as crude marched towards $100 per barrel as tensions in the Middle East rose. 

Nifty 50 declined 0.5% and Sensex fell 0.3% at pre open.  

Indian equities have remained under pressure, with both the Nifty 50 and the BSE Sensex declining 2.2% over the last seven trading sessions. The benchmarks have finished lower in six of those sessions, with both indices ending Tuesday at their weakest levels since June 12.  

The recent selloff comes as global investors turn their attention to US inflation data due later this week. The readings will be closely watched ahead of the Federal Reserve’s policy decision next week and could influence expectations around the central bank’s interest-rate trajectory. 

Any indication that inflation remains sticky could strengthen the case for tightening interest rates. That would pose a challenge for emerging-market equities such as India, as elevated US yields and a stronger dollar can make dollar-denominated assets relatively more attractive while reducing the appeal of riskier emerging markets.  

Foreign investors withdrew funds from Indian equities on Tuesday, with provisional exchange data showing net sales of ₹123 crore. Their cumulative outflow from Indian shares in September has now reached $1.33 billion (₹11,833 crore), underscoring the pressure on domestic markets from persistent foreign selling.  

Shares of Biocon could be in focus after media reports indicated that Active Pine is looking to offload stake in the pharmaceutical company through a block deal valued at around ₹638 crore.  

Coforge, an IT services company, said Chairman Om Prakash Bhatt has stepped down following an internal audit of the board’s evaluation process. The review flagged concerns, including the alleged failure to provide the board with complete material information relating to Bhatt’s own performance. 

Asian Markets Subdued 

Asian equities traded subdued on Wednesday, with gains in several technology-heavy markets offering some support even as the surge in oil prices kept broader risk appetite in check. Japan’s Nikkei 225 rose 0.3%, South Korea’s Kospi gained 2% and Taiwan’s benchmark advanced 0.6%. 

The sharp gains in South Korean equities and strength in other technology stocks provided some relief, although investors remained wary of the broader impact of higher energy prices and geopolitical tensions. 

Currency markets were also in focus, with the Japanese yen strengthening to a near seven-month high as expectations increased that the Bank of Japan could raise interest rates. A stronger yen has revived concerns over a potential unwinding of yen-funded carry trades, which could lead to greater volatility across global risk assets. 

Wall Street Ends Lower 

US stocks ended lower in the previous session as investors assessed the implications of surging crude prices, escalating geopolitical tensions and the potential inflationary impact of higher energy costs. 

The S&P 500 fell 0.58%, while the Dow Jones Industrial Average declined 1.18% and the Nasdaq Composite lost 0.32%. 

Technology stocks came under pressure, with software companies bearing the brunt of concerns over the potential disruption from artificial intelligence. The S&P 500 software and services index dropped 1.4%. 

Some semiconductor stocks bucked the trend, however, with Intel and Qualcomm gaining following developments around Amazon’s AI-chip initiatives. 

Oil remained the biggest macroeconomic concern. Brent had surged to a six-week high of $97.92 on Tuesday, while WTI settled at $93.03 after attacks on Saudi energy facilities intensified concerns about supply disruptions. 

Source

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