Indian Stock Market Expected to Open Lower Amid Global Headwinds
The Indian stock market is expected to open on a weak note due to negative signals emanating from global stock markets and the ongoing conflict in the Iran region, leading to a potential loss of nearly 200 points at the open.
Nifty May Open Lower Amid Global Headwinds
The crude oil price has surpassed $100 a barrel, sending shockwaves to oil-importing countries such as India, while the unwinding of yen carry trade will also trigger a sell-off. The Indian rupee has been under significant pressure, ending 20 paise lower at 96.73 against the US dollar on Thursday, weighed down by surging crude oil prices.
Asian Stocks Reel Under Selling Pressure
Asian stocks are reeling under selling pressure, with Korea’s Kospi leading the slide with over 3 per cent fall in early deals on Friday. Japan, Australia, Taiwan, and Singapore markets are down between 0.3 per cent and 3 per cent, tracking overnight weakness in the US market.
Market Impact and Details
- The primary trigger for the fresh round of selling was continued weakness in banking, financials, and rate-sensitive sectors, compounded by persistent worries over elevated crude oil prices and a cautious build-up ahead of key quarterly earnings.
- Global sentiment remains fragile, with soft cues from Asian peers and broader risk-off positioning keeping domestic equities under pressure, according to Sachin Gupta, VP – Technical Research, Choice Equity Broking.
- The US has announced that it will collect duties of between 10% and 12.5% on imports from most major trading partners, including India.
- The 10 per cent temporary tariff imposed by the US on imports from its trading partners, including India, was set to expire at 9:31 am (IST) on July 24, but the Trump administration has announced that it will continue in another form.
Key Takeaways
- The Indian stock market is expected to open on a weak note due to negative signals from global stock markets and the ongoing conflict in the Iran region.
- The crude oil price has surpassed $100 a barrel, sending shockwaves to oil-importing countries such as India.
- The US has announced that it will collect duties of between 10% and 12.5% on imports from most major trading partners, including India.
FAQs
What is the expected impact of the US tariffs on the Indian stock market?
The US tariffs are expected to have a negative impact on the Indian stock market, leading to a potential loss of nearly 200 points at the open.
What is the current state of the Indian rupee?
The Indian rupee has been under significant pressure, ending 20 paise lower at 96.73 against the US dollar on Thursday, weighed down by surging crude oil prices.
What is the current state of the derivatives market?
The India VIX has edged higher to 13.48, indicating that traders continue to factor in elevated volatility in the near-term. Option chain data shows maximum Put Open Interest at the 23,800 strike, followed by 23,500, suggesting that support is gradually shifting to lower strike levels as traders reposition amid the ongoing correction.
Conclusion
The Indian stock market is expected to open on a weak note due to negative signals from global stock markets and the ongoing conflict in the Iran region. The crude oil price has surpassed $100 a barrel, sending shockwaves to oil-importing countries such as India. The US has announced that it will collect duties of between 10% and 12.5% on imports from most major trading partners, including India. Investors are advised to remain cautious and monitor the market closely for any further developments.
