Markets to Open Weak on Wednesday as Brent Crude Tops $115

Mumbai, Oct 28: Indian markets are set for a flat-to-weak start on Wednesday, with Gift Nifty pointing to a soft opening as Brent crude surged above $115 per barrel and the Iran conflict showed no sign of ending. Asian stocks were trading higher in morning deals and US stocks ended strongly on Tuesday, but elevated oil prices are likely to cap Dalal Street’s gains. 

Investors will track earnings from Hero MotoCorp, Hindustan Unilever, Adani Enterprises, Adani Ports and Special Economic Zone, Hyundai Motor India and Vedanta group companies today. Management commentary on input costs and demand will be closely watched, with higher crude-linked costs a risk to margins. Hero MotoCorp and Hyundai Motor India will offer a read on auto demand after the rate hike, while HUL’s volume trend will signal consumer spending. 

Gift Nifty futures for the November 23, 2026 contract were quoted at 22,579.00 at 7:41 am IST, down 121 points, or 0.53 per cent, from the previous close of 22,700. The contract is trading about 170.75 points, or 0.75 per cent, below the Nifty 50’s Tuesday close of 22,749.75, pointing to a flat-to-weak opening with a downside bias. The quote is for the November contract, as the October series expired on Tuesday. 

Brent crude rose $2.10, or 1.84 per cent, to $115.98 a barrel, hovering near a six-month high. WTI crude gained $1.53, or 1.53 per cent, to $101.43, while Murban crude slipped 2.52 per cent to $114.71. Prices were lifted by fresh Houthi attacks on Saudi Arabia, including a claimed strike on Ras Tanura, the kingdom’s largest refinery. Those attacks, together with Iran’s stated control over the Strait of Hormuz, keep global supply under threat. 

India imports about 85 per cent of its crude oil needs. A bigger import bill widens the trade and current account deficits, raises dollar demand and pressures the rupee, which has already weakened this year. A weaker rupee then makes imports costlier, feeding imported inflation. Every $10 rise in crude is generally estimated to widen the current account deficit by roughly 0.4 per cent of GDP, by common estimates. 

Higher crude also squeezes oil marketing companies if retail fuel prices are held, or lifts transport and input costs if they are raised. Paints, tyres, aviation, chemicals and logistics are among the most exposed sectors, as crude derivatives feed into their costs. 

Asian Markets 

Asian stocks were mostly higher on Wednesday morning, led by a surge in South Korea. The Kospi jumped 6.3 per cent to 5,993.42, while Japan’s Nikkei 225 gained 1.22 per cent to 64,040.21 and Taiwan’s index rose 1.43 per cent. China’s Shanghai Composite added 0.27 per cent and Shenzhen 0.9 per cent, while Australia’s ASX 200 rose 0.19 per cent. Hong Kong’s Hang Seng was the exception, easing 0.05 per cent to 23,030.51. 

US Markets 

US stocks ended higher on Tuesday, with the Nasdaq leading. The Nasdaq Composite rose 1.18 per cent to 26,477.81 and the S&P 500 gained 0.6 per cent to 7,722.60, while the Dow Jones Industrial Average edged up 0.03 per cent to 52,377.57. The Russell 2000 gained 1.16 per cent, and the VIX volatility index fell 4.73 per cent to 17.52. 

Iran War 

Iran’s Security Council chief Mohsen Rezaei met Supreme Leader Ayatollah Mojtaba Khamenei on Tuesday, a day after talks in Tehran with officials from Saudi Arabia, Turkey and Pakistan, the Mecca pact countries. State media said Khamenei stressed maintaining Iran’s conditions for ending the war, which include an end to the US blockade of Iranian ports and sanctions on oil exports. Separately, Yemen’s Houthis said they hit Saudi Arabia’s Ras Tanura refinery with a ballistic missile, though Riyadh has not confirmed it and Bloomberg cited a source saying a fire near the terminal was contained. The war, which began in February when the US and Israel attacked Iran, is now in its eighth month. 

Tuesday’s close 

The Sensex fell 8.08 points, or 0.01 per cent, to 73,598.67 on Tuesday, while the Nifty 50 slipped 3.45 points, or 0.02 per cent, to 22,749.75 on expiry day. Broader markets outperformed, with the Nifty Midcap index up 1 per cent and the Nifty Smallcap index surging 2.7 per cent, while 2,807 shares advanced against 1,334 declining. Tata Consumer Products, Bharti Airtel, Trent, BSE and Power Grid were the top Nifty gainers, while Grasim, SBI, Coal India, TCS and Asian Paints led the losers. Media rose 3.6 per cent and realty and pharma about 2 per cent each, but IT, oil and gas and private banks each lost about 0.5 per cent. 

Source

• nseindia.com