Shares Flatline at Pre-open as Nifty, Sensex Set for a Muted Start on Middle East Flare-up

Mumbai, June 10: Indian shares were muted at pre-open signalling a flat start for benchmark indices as the Middle East flared up causing oil to rise.  

Nifty 50 was 0.02% higher at pre-open while the Sensex went up 0.1%. Gift Nifty futures traded 0.1% higher.  

Indian benchmarks Nifty and Sensex advanced about 0.5% each in the previous session after the RBI came out with guidelines for a forex swap facility for banks’ overseas borrowings it had announced last week, while easing geopolitical tensions in the Middle East boosted investor sentiment.  

 Investors will also be keeping an eye out for U.S. inflation data releasing later in the day to get an idea of the trajectory for US interest rates.  

 Oil prices rose 0.8% raising concerns for India which is the world’s third-largest oil importer even as foreign investors keep fleeing from the domestic markets. 

The spotlight will be falling on IT heavyweight Infosys which will be going through ex-dividend adjustments.  

 Spotlight will also be falling on Patanjali Foods, Bharti Airtel and Dixon Technologies. Patanjali Foods said it has received a notice from Maharashtra’s drug regulator over alleged misleading advertisements and promotional claims related to its juice products. The regulator has directed the company to stop the sale of its Karela Jamun juice. Bharti Airtel said the Bombay High Court has quashed a demand notice amounting to Rs 8,414 crore, providing relief to the telecom operator. Dixon Technologies has entered into a binding term sheet with Taiwan-based Gemtek Technology for a joint venture to make optical transceivers and networking equipment for the data centre and telecom sectors. 

 As for global cues, Asian equities traded in the red, with Japan’s Nikkei and South Korea’s Kospi among the worst performers, while MSCI’s broadest index of Asia-Pacific shares outside Japan also declined. Investors remained cautious amid concerns that rising hostilities between the United States and Iran could disrupt global energy supplies and weigh on economic growth. 

 Crude oil prices extended gains, with Brent crude rising 0.8% on fears of potential supply disruptions in the Middle East. The move is being closely watched by Indian investors as higher oil prices could stoke inflationary pressures, widen the current account deficit and weigh on earnings of oil-dependent sectors. 

 U.S. markets delivered mixed cues overnight. Wall Street initially advanced as semiconductor stocks extended their recent rally, supported by optimism surrounding artificial intelligence-led demand and continued strength in the technology sector. 

 However, gains proved short-lived after fresh geopolitical concerns resurfaced. Investor sentiment weakened following comments from U.S. President Donald Trump that heightened worries over a possible escalation in tensions with Iran. 

 The renewed risk-off mood prompted investors to trim exposure to equities, causing the S&P 500 and Nasdaq to surrender earlier gains and close lower. The session highlighted how geopolitical developments continue to overshadow positive momentum in technology shares. 

 European shares ended lower on Tuesday, with investors remaining cautious amid ongoing uncertainty in the Middle East. 

 The pan-European STOXX 600 index fell for a third straight session as weakness in mining, industrial and energy stocks weighed on sentiment. Market participants largely stayed on the sidelines ahead of the European Central Bank’s policy decision and a busy week of economic data releases. 

 The prospect of higher energy costs and their impact on inflation also remained a key concern for investors across the region. 

Source

•  Exchanges