Before the Market Opens: Indian markets will open lower on Monday, reflecting the decline in global markets due to the rising geopolitical tensions in the Middle East, triggered by Iran’s unexpected attack on Israel over the weekend. Gift Nifty traded over 100 points lower, indicating a weak start for benchmark Nifty. Let’s look at some key indicators before the market opens today:
U.S. stock indexes ended sharply lower on Friday after earnings from major U.S. banks failed to impress and threatened geopolitical tensions. The Dow Jones Industrial Average fell 475.84 points, or 1.24%, to 37,983.24, while the S&P 500 fell 75.65 points, or 1.46%, to 5,123.41. The Nasdaq Composite closed 267.10 points, or 1.62%, lower at 16,175.09.
Asian stocks fell and gold prices rose on Monday as risk-on sentiment took a hit after Iran’s retaliatory attack on Israel sparked fears of a wider regional conflict and kept traders on edge. Markets in Asia started the week on a cautious footing. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.7% after Iran late on Saturday launched explosive drones and missiles at Israel in retaliation for a suspected Israeli attack on its consulate in Syria on April 1. Japan’s Nikkei slipped more than 1.%, while Australia’s S&P/ASX 200 index lost 0.6%. Hong Kong’s Hang Seng Index fell 0.8%.
On Friday, the Indian stock market indices ended a percent lower each dragged by selling across the board amid weak global cues. The Sensex plunged 793.25 points, or 1.06%, to close at 74,244.90, while the Nifty 50 settled 234.40 points, or 1.03%, lower at 22,519.40.
At 8:15 am, Gift Nifty was trading 134 points or 0.6 percent lower at 22,452, indicating a weak opening for the Indian markets.
Geopolitical tensions rose in the Middle East after Iran launched more than 300 drones and missiles against military targets in Israel on Saturday night in response to a suspected Israeli attack on Iran’s Syrian consulate on April 1. Iran’s Islamic Revolutionary Guard Corps (IRGC) confirmed the attack saying it was “targeted at specific targets”. Meanwhile, Israel is likely to strike back at Iran in retaliation.
Oil prices fell at the Asian open on Monday as market participants reduced risk premiums following Iran’s attack on Israel late on Saturday, which the Israeli government said caused limited damage. Brent futures for June delivery fell 24 cents to $90.21 a barrel while West Texas Intermediate (WTI) futures for May delivery were down 38 cents at $85.28 a barrel by 1256 GMT.
Gold prices rose on Monday, hovering below a record high hit in the previous session, as rising tensions in the Middle East lifted the safe-haven appeal of bullion. Spot gold was up 0.3% at $2,350.59 an ounce, as of 0056 GMT. Bullion hit an all-time high of 2,431.29 on Friday. US gold futures fell 0.3% to $2,366.40 an ounce.
The US dollar steadied on Monday after posting its most significant weekly gain since 2022. This stability comes amid expectations of raised interest rates and rising tensions in the Middle East. Last week, the dollar rose 1.6% against a basket of six major currencies. Additionally, US two-year yields climbed 15 basis points amid diminishing prospects for early interest rate cuts, with markets pricing in just a 50 basis point cut for this year, with the first cut not fully expected until September.
In March, India’s retail inflation fell to a 10-month low of 4.85% compared to 5.09% in the previous month. At the same time, the country’s industrial production, as assessed by the Index of Industrial Production (IIP), increased to 5.7% in February from 3.8% in January 2024, signaling an increase in the manufacturing segment of the Indian economy.
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Published: 15 Apr 2024, 08:34 IST