Markets are poised to open lower on Tuesday as GIFT Nifty futures traded at 24,048 points, down 72.10 points, indicating that the benchmark Nifty 50 would open below Monday's close of 24,092.70. According to ABP Live, this follows a three-session losing run that was snapped on Monday, with both the Nifty and Sensex closing higher led by a rebound in information technology stocks following last week's sharp selloff. However, European stock markets were little changed on Monday morning, with both the Euro Stoxx 50 and the broader Stoxx 600 hovering close to the flatline as investors assessed the latest developments in US-Iran negotiations. The decline in GIFT Nifty points to a subdued opening for benchmark indices, with traders adopting a wait-and-watch stance as geopolitical developments and global macro cues continue to drive near-term direction.
The market sentiment remains constrained due to unresolved geopolitical tensions, particularly around the Strait of Hormuz — which handles about a fifth of global oil flows, pushing crude prices significantly higher. Brent crude futures held above $108-109 per barrel on Monday, while US benchmark WTI crude rose close to $96 after Axios reported that Iran has put forward a new proposal to lift its blockade of the key Hormuz waterway but would push nuclear negotiations to a later date. As reported by Africanews, the uptick comes after a second round of US-Iran talks failed to make progress over the weekend, with the White House calling off plans to send envoys to Pakistan for more negotiations. Reports suggest Washington is reviewing Tehran's latest proposal, though concerns remain over unresolved nuclear issues. With no clear breakthrough in sight, markets are factoring in prolonged uncertainty, adding to risk aversion.
Gasoline prices are expected to turn higher in the next week as oil holds above $109 per barrel amid uncertainty over the US-Iran war. The national average rose to $4.11 per gallon on Monday, up about $0.07 from a week ago, according to AAA data. Andy Lipow, president of Lipow Oil Associates, predicts gasoline prices in the US will increase to $4.20 per gallon over the next 7 to 10 days. Shipping through the Strait of Hormuz, a key global oil route, remains at minimal levels as governments abroad have been aggressively drawing down their strategic petroleum reserves. Lipow warns that "We cannot draw inventories forever" and notes that while oil inventories in the USA are currently adequate, as the world turns to the USA for supply, our inventories drop and in the worst case reach minimum operating levels in a few months.
Foreign portfolio investors offloaded domestic stocks worth ₹1,151 crore ($122.2 million) on Monday, continuing their selling streak to the sixth session. However, according to The Hindu BusinessLine, domestic institutional investors bought ₹4,124 crore worth of shares, remaining buyers for a third straight session. This divergence in investment flows highlights the mixed sentiment among different investor categories as markets navigate geopolitical uncertainties.
Among individual stocks, UltraTech Cement, the country's largest cement maker by capacity, will be in focus after beating quarterly profit estimates, aided by improved demand amid favourable weather for construction activity. As reported by The Hindu BusinessLine, State-owned miner Coal India reported a larger-than-expected March-quarter profit, driven by higher prices and improved demand. SBI Cards and Payment Services posted a 14 per cent year-on-year rise in quarterly profit.
Elevated oil prices are a headwind for India, the world's third-largest crude importer, as they heighten inflation risks, pressure economic growth and corporate earnings, and widen the country's import bill. According to The Hindu BusinessLine, the ongoing Iran war situation continues to create uncertainty in global oil markets, with continued Iranian missile activity forcing oil tankers to avoid the Strait of Hormuz, a key shipping route through which around a fifth of the world's crude oil supply typically passes. The Strait of Hormuz remains a key chokepoint for global oil flows as geopolitical tensions persist, with Lipow forecasting that the WTI crude oil price will drift back up to $100 and Brent will top $110 absent new negotiations. For India, high crude prices pose a significant macro challenge, impacting inflation, currency stability, and corporate profitability.
