Nifty, Sensex Set for Weak Start as Shares Decline at Pre-Open Amid Oil Spike

Mumbai, May 18:Indian shares traded lower at the pre-open signalling a weak start for benchmark indices as oil prices saw a surge after a nuclear power plant in the UAE came under a drone attack even as the US-Iran war stalemate continued.

Nifty 50 traded 0.59% lower at pre-open while the Sensex was seen down 0.56%.

Gift Nifty futures also supported the downtrend, trading at 23,546.50, which is below Nifty 50’s Friday close of 23,643.50.

Benchmark indices Nifty 50 and Sensex had fallen 2.2% and 2.7%, respectively, last week, while the rupee had slid past 96 per dollar to hit a record low on Friday amid surging crude oil prices and continued foreign fund outflows.

The spotlight will fall on Tata Steel, Power Grid and Gland Pharma. Tata Steel saw smaller-than-expected profit after input costs and a one-time charge hit earnings. Power Grid clocked a 10% rise in profit while Gland Pharma posted almost doubled its bottomline.

Speaking of global cues, equity markets across Asia came under broad selling pressure. Japan’s Nikkei slipped nearly 1%, while MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.8%. Hong Kong’s Hang Seng dropped 1.6%, reflecting growing risk aversion among investors. South Korea’s Kospi, however, bucked the regional trend and rose 0.8%.

Higher crude prices remain a key concern for import-dependent economies such as India, where elevated energy costs could worsen inflationary pressures and weigh on the rupee.

The surge in oil prices also sparked a selloff in global debt markets. U.S. Treasury yields climbed to multi-month highs, with the benchmark 10-year yield touching 4.63%, as traders increasingly bet that the Federal Reserve may need to keep interest rates higher for longer, or even tighten policy further if inflation accelerates again. European bond markets were also under pressure ahead of the region’s trading session.

U.S. stock futures traded lower during Asian hours on Monday. Dow futures fell around 400 points, while S&P 500 and Nasdaq futures also declined as investors reassessed the impact of rising energy prices on inflation, consumer demand and corporate profitability.

Despite the recent resilience in technology stocks driven by optimism around artificial intelligence, market sentiment has turned cautious ahead of a key earnings week in the United States. Investors are closely watching upcoming results from chip giant Nvidia and retail major Walmart for signals on consumer demand and the sustainability of the AI-driven rally.

Source:

• Exchanges