Indian Markets Seen Opening Lower As Asian Stocks Fall, Oil Surges Above $100

Mumbai, July 24: Indian markets are likely to open on a negative note on Friday, tracking a fall across Asian equities after Wall Street and European markets also ended lower. A surge in oil prices above $100 a barrel, renewed concerns over inflation and a selloff in technology stocks are expected to weigh on sentiment, although domestic institutional buying and stock-specific action around corporate earnings could limit the downside. 

The Nifty 50 and Sensex could face pressure at the open as investors digest a broad deterioration in global risk appetite. Higher crude prices could add to concerns around India’s inflation, trade deficit and the rupee. 

Asian Markets Fall As Oil Spike Revives Inflation Fears 

Asian markets fell sharply on Friday, tracking losses on Wall Street and in Europe, as a surge in oil prices fuelled inflation concerns and renewed worries over the outlook for interest rates. 

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1%, while Japan’s Nikkei dropped 2.8% and South Korea’s KOSPI plunged 4.8%. The weakness came as renewed tensions in the Middle East disrupted key oil shipping routes and raised concerns about a prolonged period of elevated energy prices. 

The jump in crude prices is particularly negative for major oil-importing economies such as India, where higher energy costs can put pressure on inflation, the current account deficit and the rupee. A sustained rise in crude could also complicate the outlook for monetary policy while raising input costs for several industries. 

Wall Street Slides As Big Tech Results Rekindle AI Spending Concerns 

The global risk-off mood was reinforced by a sharp decline on Wall Street. The Nasdaq Composite fell more than 2%, while the S&P 500 declined over 1% as investors reassessed the outlook for technology companies following quarterly results from major firms. 

Concerns over the scale of spending on artificial intelligence infrastructure resurfaced after results from Alphabet and Tesla, with investors questioning whether the massive capital expenditure required for AI will generate adequate returns and cash flows. 

Tesla shares plunged 14.5% after the electric vehicle maker reported its first negative free cash flow in more than two years, while Alphabet also came under pressure as investors focused on its elevated AI-related capital expenditure plans. 

The technology-led selloff spread across the broader market, although strong results and outlook upgrades from defence companies such as Lockheed Martin and RTX provided some support. 

The rise in oil prices also pushed U.S. Treasury yields higher, adding to concerns that renewed inflationary pressures could limit the scope for monetary easing. The 10-year Treasury yield climbed to its highest level since early 2025 as investors weighed the implications of higher energy costs. 

European Shares Fall 

European equities faced similar pressure, with the pan-European STOXX 600 falling 1.3% as oil surge and concerns over rate hikes weighed on stocks.  

While the European Central Bank left interest rates unchanged on Thursday, comments from President Christine Lagarde were interpreted by markets as signalling the possibility of a rate hike in September. 

Indian Stocks May Get Negative Start 

For Indian markets, the immediate global cues remain negative. The fall in Asian equities, combined with losses on Wall Street and in Europe, points to a weak start for the Nifty 50 and Sensex on Friday. 

The jump in oil prices could also weigh on oil-sensitive sectors and the broader market mood, while potentially supporting upstream oil producers. The rupee and bond yields will be closely watched as investors assess the impact of higher energy prices on India’s inflation outlook. 

Domestic factors, however, could provide some cushion. Ongoing corporate earnings, stock-specific developments and buying by domestic institutional investors may limit the downside. 

Overall, with global equities under pressure, crude oil prices surging above $100 a barrel and geopolitical risks escalating, Indian markets are likely to begin Friday’s session on a weak note, with volatility remaining elevated and investors favouring defensive positioning. 

Source

• Exchanges