On the first trading day after the Diwali break, Indian markets stand poised for a higher open, lifted by a stretch of cheaper oil and a return of foreign money that has pushed the Nifty 50 to its highest close in more than eight months. The calm has a shadow, for the same week that eased the cost of crude brought hotter American inflation figures, and with them the prospect of a sharper Federal Reserve hike that could pull capital back toward the United States. It is a familiar rhythm in global finance: relief in one corner of the world is always weighed against the tightening of money in ano
Indian Stocks Set for Higher Open as Crude Eases and Foreign Investors Return
On the first trading day after the Diwali break, Indian markets stand poised for a higher open, lifted by a stretch of cheaper oil and a return of foreign money that has pushed the Nifty 50 to its highest close in more than eight months. The calm has a shadow, for the same week that eased the cost of crude brought hotter American inflation figures, and with them the prospect of a sharper Federal Reserve hike that could pull capital back toward the United States. It is a familiar rhythm in global finance: relief in one corner of the world is always weighed against the tightening of money in another.
Indian markets return on Wednesday after a one-day Diwali closure, and the early signals point upward. GIFT Nifty futures were trading at 25,334 in the early morning, suggesting the benchmark Nifty 50 will open above Monday's close of 25,044.65, its highest in more than eight months.
Two forces lie behind the lift. Oil fell to a two-month low of $89.16 a barrel on Tuesday after US officials downplayed the need for further military action against Iran, easing fears of supply disruption. Brent edged back up to around $92 by Wednesday. Foreign investors, meanwhile, have returned in strength. The Nifty and the Sensex have each climbed nearly 9% in November, and overseas funds have bought $5.68 billion of Indian shares this month, their largest monthly purchase since September 2024.
Elsewhere, the mood is more cautious. Overnight US inflation came in hotter than expected, sending Treasury yields higher and Wall Street lower, and raising the chance of a half-point Fed rate hike next month. Higher American rates can pull money away from emerging markets, which is why the data weighs against the optimism in Mumbai.
Company news is mixed. Blackstone will buy about 16% of IIFL Finance for 50 billion rupees as part of a $682.9 million fundraising. Tyre maker MRF saw quarterly profit fall nearly 28% as raw material costs rose, while Kalyan Jewellers posted a 64% jump in second-quarter profit on 31.4% higher revenue.
For now the open looks positive. The question ahead is whether foreign buying survives if the prospect of a larger Fed hike keeps US yields climbing.
Indian markets reopen on Wednesday after a one-day closure for Diwali, and the early indicators point upward. GIFT Nifty futures stood at 25,334 as of 7:41 a.m. IST, a signal that the benchmark Nifty 50 is likely to start higher than where it left off. That was 25,044.65 on Monday, its highest close in more than eight months.
Two forces are behind the expected lift. One is oil. Brent crude futures dropped on Tuesday to a two-month low of $89.16 a barrel after US officials played down the need for further military action against Iran, which eased worries about supply disruptions. By Wednesday, Brent had recovered slightly, up 0.5% at $92.
The other is money coming in from abroad. The Nifty 50 and the BSE Sensex have each gained nearly 9% so far in November. Reuters ties that run to cheaper crude, strong domestic corporate earnings and a selloff in global chipmakers, which together drew foreign portfolio investors back to India. Those investors have bought $5.68 billion worth of Indian shares this month, already their largest monthly purchase since September 2024.
The backdrop elsewhere is less friendly. Overnight, US Treasury yields jumped and Wall Street stocks fell after inflation data came in hotter than expected. That raised the odds of a half-percentage-point interest-rate hike by the Federal Reserve next month. Higher US rates tend to make American assets more attractive relative to emerging markets, which is why the inflation print sits as a counterweight to the optimism in Mumbai.
Several individual stocks are in focus. Blackstone will buy about 16% of IIFL Finance for 50 billion rupees, roughly $535 million, as part of a $682.9 million fundraising by the non-bank lender.
Results were mixed among companies that reported. Tyre maker MRF posted a near 28% drop in quarterly profit, as higher raw material costs outweighed strong demand for its tyres. Kalyan Jewellers India reported a 64% jump in second-quarter profit, with revenue up 31.4%.
For now, the open looks positive. The thing to watch is whether the foreign buying that has powered November holds up if the prospect of a larger Fed hike keeps pushing US yields higher.
Möchten Sie die ganze Geschichte?
Das Original lesen bei Reuters ↗