Indian Shares Flat At Pre-Open As Sensex, Nifty Stare At Muted Start Amid Asian Fall, Fragile US-Iran Pause

Mumbai, July 28: Indian shares trade flat at pre open signalling a muted start for benchmarks as Asian markets fell and the fragile pause in Iran war kept investors on the edge. 

Nifty 50 declined 0.07% and Sensex rose 0.13% at pre open while Gift Nifty edged lower by 0.1%.  

Indian equities staged a strong rebound on Monday, with both the Nifty 50 and Sensex gaining roughly 1% and recovering part of the ground lost in the previous week’s selloff. The benchmarks had declined 2.3% and 2.7%, respectively, over the preceding five sessions. 

US central bank’s rate decision is due on Wednesday. It is expected to keep rates unchanged.  

Bharat Electronics is likely to attract attention after reporting higher June-quarter earnings, as robust execution helped offset weaker-than-expected margins.  

Tata Power also posted year-on-year growth in first-quarter profit, supported by improved operating performance and expansion in its transmission and distribution business.  

Coal India, meanwhile, fell short of profit expectations for the June quarter as weaker volumes and elevated costs weighed on performance.  

Airline major IndiGo named company insider Kiran Thadimarri as its chief financial officer. 

Asian markets reel under technology selloff 

Asian stocks offered a weak lead on Tuesday, with technology and chip stocks bearing the brunt of the selloff. South Korea’s KOSPI plunged 9.6%, hit by a sharp decline in semiconductor shares, while Japan’s Nikkei dropped 4.4%. Hong Kong’s Hang Seng index was down 0.4%. 

The selloff reflected growing investor unease over the enormous sums being committed to artificial intelligence infrastructure and whether the spending will ultimately deliver returns that justify current valuations. The concerns have prompted investors to reassess the steep gains recorded by technology stocks during the AI-led rally. 

The weakness in global chip and technology shares could weigh on Indian IT stocks at the open, particularly heavyweight technology companies that remain sensitive to global risk appetite and spending trends among overseas clients. 

Wall Street trades mixed ahead of tech earnings 

US equities ended a lacklustre session on Monday with mixed results as investors prepared for a busy week of earnings from some of the world’s biggest technology companies. 

The S&P 500 edged up 0.02%, while the Nasdaq Composite slipped 0.18%. The Dow Jones Industrial Average outperformed, rising 0.51%. 

Investors are looking to results from Microsoft, Amazon, Meta Platforms and Apple for clues on the strength of corporate spending on artificial intelligence and whether the technology rally can maintain its momentum. At the same time, concerns over elevated crude prices have raised questions about the potential impact of energy-driven inflation on the Federal Reserve’s interest-rate outlook. 

For Indian equities, the mixed Wall Street finish is unlikely to offer a strong directional cue, leaving investors to track the sharp moves in Asian markets, crude prices and company-specific developments. 

European stocks give up early gains 

European equities also failed to sustain an initial rally on Monday. The pan-European STOXX 600 index ended broadly flat after rising nearly 1% earlier in the session, as losses in technology stocks offset gains driven by optimism over a pause in US-Iran hostilities and lower energy prices. 

The performance underscored the competing forces shaping global markets, with hopes of easing geopolitical tensions and falling oil prices supporting risk appetite, while concerns over elevated technology valuations and the scale of AI-related investment continued to weigh on sentiment. 

Oil slide offers support to Indian markets 

Crude oil prices remained a key positive factor for India, with prices falling 1.7% on Tuesday as investors assessed the prospects of a diplomatic breakthrough in the US-Iran conflict and the potential for energy supplies from the Middle East to normalise. 

Brent crude was trading near $87 a barrel, while US West Texas Intermediate stood around $81. 

 Lower oil prices are particularly favourable for India, a major crude importer, as they can help contain the country’s import bill and inflationary pressures while easing costs for businesses. A sustained decline in crude could also offer support to the rupee and improve sentiment towards sectors that are sensitive to energy prices. 

Source

• Exchanges