Asia Mixed, Wall Street Slides, Crude Slumps: Indian Share Market Seen Starting on Cautious Note

Mumbai, June 24: Indian benchmark indices are likely to open on a cautious note on Wednesday amid weakness in global technology stocks and growing concerns over the U.S. interest-rate outlook.

Asian markets traded in a mixed fashion as investors weighed the benefits of easing energy prices against the fallout from a technology-led selloff across global equities. MSCI’s broadest index of Asia-Pacific shares outside Japan declined 1%.

South Korean equities rose1.5% after suffering their steepest decline in months during the previous session, with bargain hunting emerging in semiconductor and technology stocks. Japanese shares, however, remained under pressure, declining 0.4%, as investors reassessed growth-sector valuations.

Sentiment received support from the continued decline in crude oil prices after signs of progress in U.S.-Iran talks eased concerns about supply disruptions through the Strait of Hormuz, a key route for global energy shipments. For oil-importing economies such as India, lower crude prices are viewed as a positive development as they help reduce inflationary pressures and improve the outlook for corporate profitability.

Wall Street Slides as Tech Stocks Lead Losses

The overnight cues from the United States remained weak, however, with technology stocks dragging major indices lower.

The Nasdaq Composite fell more than 2%, while the S&P 500 also ended in the red as investors questioned the sustainability of heavy spending on artificial intelligence infrastructure and reassessed valuations across the technology sector.

Market participants also grew increasingly wary of the prospect that the U.S. Federal Reserve may keep borrowing costs higher for longer if inflation proves stubborn. The shift in rate expectations weighed on growth-oriented stocks and triggered broad profit-taking across technology counters.

The weakness on Wall Street could spill over to Indian information technology stocks, which derive a significant portion of their revenue from North America and often track sentiment in U.S. technology shares.

European Markets Mirror U.S. Weakness

European equities also closed lower, reflecting the cautious tone seen globally.

The pan-European STOXX 600 index declined as technology and semiconductor stocks led losses across the region. Investors remained focused on the outlook for monetary policy and the potential impact of higher interest rates on economic growth and corporate earnings.

Defensive sectors such as healthcare and consumer staples offered some support, but were unable to offset broader weakness in growth-oriented shares.

Cautious Start Likely for Indian Equities

Indian equities may get a cautious start amid mixed global cues.

Oil-sensitive sectors such as aviation, paints, chemicals and oil marketing companies could benefit from the decline in crude prices.

Overall, the combination of softer crude prices and mixed Asian cues suggests the Sensex and Nifty are likely to begin on a cautiousnote.

Source:

• Exchanges