Shares Advance At Pre-Open As Benchmarks Set For Higher Open Amid Oil Decline

Mumbai, August 27: Indian shares rose at pre open signalling a positive start for benchmarks as oil declined for a fourth day on Middle East optimism and Nvidia earnings beat lifted Asian equities. 

Nifty 50 rose 0.3% and Sensex advanced 0.13% at pre open.  

Domestic equities ended lower on Wednesday, with the Nifty declining 0.5% and the Sensex shedding 0.2% as weakness in information technology stocks and Reliance Industries weighed on the benchmarks. Selling pressure intensified towards the closing auction.  

Foreign portfolio investors continued to provide support, remaining net buyers for a third consecutive session. FPIs bought Indian equities worth Rs 503 crore ($52.72 million) on Wednesday, while domestic institutional investors made net purchases of Rs 6,425 crore, according to provisional NSE data.  

FPI inflows into Indian equities have strengthened in August, with overseas investors buying stocks worth $2.85 billion so far this month, the highest monthly inflow since September 2024, according to National Securities Depository data.  

Spotlight will fall on Bharat Electronics which received orders worth Rs 730 crore since August 10, adding to the defence electronics maker’s order pipeline.  

Juniper Green Energy reported a 54% year-on-year increase in profit for the June quarter.  

Titagarh Rail Systems entered into a non-binding agreement with Siemens to explore opportunities in metro rail projects across global markets. 

Asia advances 

MSCI’s broadest index of Asia-Pacific shares excluding Japan rose 0.6%, extending gains for a third straight session. South Korea’s KOSPI climbed 1.8%, while Taiwan’s benchmark advanced 0.9%. Japan’s Nikkei was marginally lower, declining 0.15%. 

Nvidia shares jumped 4.7% in after-hours trading after the chipmaker reported more than a doubling in quarterly revenue and projected third-quarter revenue above Wall Street expectations. The upbeat results also lifted S&P 500 e-mini futures by 0.5%, pointing to firmer sentiment in U.S. equities. 

Nvidia boosts tech sentiment 

The strong Nvidia results have renewed optimism around artificial-intelligence spending, easing some concerns over stretched valuations and the sustainability of the AI investment cycle. 

The positive reaction came after U.S. equities ended slightly lower on Wednesday as investors weighed a hotter-than-expected inflation reading ahead of Nvidia’s results. The Dow Jones Industrial Average fell 0.21%, while the S&P 500 and Nasdaq Composite declined 0.02% and 0.08%, respectively. 

U.S. inflation rose 3.7% in the 12 months through July, above expectations of 3.6%, keeping uncertainty around the Federal Reserve’s rate trajectory elevated. 

Investors are now awaiting Federal Reserve Chair Kevin Warsh’s speech at Jackson Hole on Friday for clues on the outlook for interest rates. The stronger inflation reading has raised expectations that the Fed could adopt a less dovish stance, with the probability of a September rate hike at 38.1%, according to CME FedWatch. 

Oil extends decline 

Crude oil prices provided another supportive cue for India, with Brent futures falling 0.9% to around $87 a barrel and heading for a fourth straight session of declines. 

Prices weakened as Qatar’s prime minister prepared to visit Tehran in an effort to revive U.S.-Iran peace talks, raising hopes of progress towards easing geopolitical tensions and improving crude supply prospects. 

For India, sustained weakness in oil prices could help contain inflationary pressures, narrow the current account deficit and lower input costs for companies. Paints, chemicals, aviation and logistics companies could benefit from cheaper crude and its derivatives. 

Source

• Exchanges