Market Opening Under Pressure
The Indian stock market is poised for a negative opening on Tuesday, with benchmark indices Sensex and Nifty 50 expected to decline following weakness in global markets. This comes after a strong performance on Monday where domestic indices closed significantly higher.
Global Market Sentiment Turns Negative
Asian markets traded lower on Tuesday, mirroring the overnight slide on Wall Street. Japan's Nikkei 225 plunged 2.28%, while South Korea's Kospi fell 1.63%. The negative sentiment was reflected in Gift Nifty trading around 26,001 level, indicating a discount of nearly 59 points from Nifty futures' previous close.
On Wall Street, US stock markets ended sharply lower on Monday, driven by technology stocks. The Dow Jones Industrial Average declined 557.24 points or 1.18% to 46,590.24, while the S&P 500 dropped 61.70 points or 0.92% to 6,672.41. The Nasdaq Composite closed 192.51 points or 0.84% lower at 22,708.08.
Domestic Market Performance and Outlook
Despite the expected weak opening, market experts remain optimistic about India's long-term prospects. On Monday, the Sensex rallied 388.17 points or 0.46% to close at 84,950.95, while the Nifty 50 settled 103.40 points or 0.40% higher at 26,013.45.
Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services Ltd, stated: "We expect the market to witness continued up-move, driven by improving earnings momentum, strong domestic macros and stable policy support."
The positive domestic sentiment was supported by upbeat Q2 results and prospects of an India-US trade deal. According to reports, the first phase of the proposed India-US bilateral trade agreement is nearing closure and would address the hefty 50% tariffs imposed by the US administration on Indian goods.
Key Economic Indicators and Commodity Prices
India's unemployment rate for people aged 15 and above held steady at 5.2% in October, unchanged from September. However, trade data showed concerning trends with exports contracting 11.8% to $34.38 billion in October, while imports jumped 16.63% to an all-time high of $76.06 billion.
The trade deficit widened to a record high of $41.68 billion, primarily due to high inbound shipments of gold, silver, cotton raw/waste, fertiliser, and sulphur.
In commodity markets, gold prices fell for a fourth straight session, with spot gold declining 0.1% to $4,038.43 per ounce. Crude oil prices steadied, with Brent crude falling 0.37% to $63.96 a barrel and US West Texas Intermediate crude futures declining 0.38% to $59.68.
The dollar index, measuring the US currency against major rivals, was last up 0.2% at 99.545, while the yen slid to its weakest level in more than nine months.
