Shares Edge Down At Pre-Open Signalling A Lower Start As Fresh US Sanctions Hit Iran

Mumbai, August 25: Indian shares slipped at pre open signalling a lower start for benchmarks as Asia traded lower amid fresh US sanctions on Iran and sentiment remained cautious ahead of ‌the monthly expiry of benchmark Nifty 50 derivatives contracts. 

Nifty 50 declined 0.2% and Sensex slipped 0.14% while Gift Nifty edged down 0.12%.  

Foreign portfolio investors were net buyers of Indian equities on Monday, picking up shares worth Rs 1,182 crore ($123.52 million), according to provisional exchange data.  

Tata Consultancy Services is set to acquire Porsche AG’s automotive and consulting business MHP, deepening the technology partnership between the two companies. As part of the broader arrangement, Porsche has committed $1.46 billion to TCS and MHP.  

Great Eastern Shipping Company will consider a share buyback proposal on August 27, putting the stock in focus ahead of the board meeting. 

Asia Markets Lower 

Asian stocks traded mostly lower on Tuesday, with technology shares leading the decline as investors remained cautious ahead of Nvidia’s quarterly results and assessed the impact of expanded US economic pressure on Iran. 

Japan’s Nikkei edged up 0.11%, while South Korea’s Kospi declined 2.4%. MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.76%. 

The weakness in Asian technology stocks could weigh on Indian IT shares at the open, particularly large-cap software exporters that tend to track global technology sentiment. 

Wall Street Ends Lower 

The subdued Asian session followed a weak finish on Wall Street, where the S&P 500 and Nasdaq ended lower on Monday as semiconductor stocks came under pressure. 

Investors remained cautious ahead of Nvidia’s earnings and weighed the prospect of tougher US sanctions on Iran. Nvidia, Micron Technology and Broadcom declined, dragging the broader technology sector lower. The Dow Jones Industrial Average, however, bucked the trend and ended higher, helped by gains in financial stocks including JPMorgan Chase and Visa. 

Nvidia’s results will be closely watched for fresh signals on the sustainability of the artificial intelligence investment boom, with any disappointment potentially adding to the recent pressure on global technology stocks. 

Oil Prices Edge Higher 

Crude oil prices, meanwhile, edged higher on Tuesday after tumbling more than 2% in the previous session. Brent crude was around $92.6 a barrel, up 0.4%, while West Texas Intermediate was near $85.5. 

Oil markets remain focused on the fallout from expanded US sanctions on Iran. While the measures target countries doing business with Iran, the lack of specific targets and an immediate implementation timeline has eased fears of a sudden disruption to crude supplies. 

Geopolitical risks, however, remain elevated. A tanker was reportedly struck near Oman, while Iran reiterated its claims over the Strait of Hormuz, a critical route for global oil shipments. 

For India, which imports a large share of its crude requirements, elevated oil prices remain a concern. A sustained decline in crude would be positive for the country’s trade balance, inflation, corporate margins and the rupee, but prices above $90 a barrel could continue to keep investors cautious. 

Nvidia, Fed Comments In Focus 

Besides geopolitics, investors are awaiting Nvidia’s results for clues on the health of the global AI trade. Markets are also looking for signals on the US interest-rate outlook from Federal Reserve Chair Kevin Warsh at Jackson Hole. US Treasury yields have eased, offering some relief to global equities. 

Source

• Exchanges