Indian shares to open higher on strong growth data; Middle East jitters could temper optimism
- GIFT Nifty futures were at 24,178 points
Indian shares are expected to open marginally higher due to strong domestic growth, though rising crude oil prices from renewed Middle East tensions may limit optimism.
- Stronger-than-expected Indian economic growth.
- Renewed Middle East tensions and rising crude oil prices.
- Impact of geopolitical events on global and Indian markets.
- Foreign investor selling and Nifty 50 derivatives expiry.
Indian shares were expected to open marginally higher on Tuesday on stronger-than-expected domestic growth data, although rising crude oil prices due to renewed Middle East tensions could keep any optimism in check.
GIFT Nifty futures were at 24,178 points as of 7:59 a.m. IST, indicating a positive start for the Nifty 50.
The benchmark index closed at a one-month low of 24,080.4 on Monday.
India’s economy expanded 7.8% year-on-year in the April-June quarter, blowing past forecasts as an investment boom and manufacturing strength added to already-solid consumer demand.
The upside surprise for Asia’s third-largest economy landed even as geopolitical tensions from the U.S.-Israeli war on Iran continued to rattle global markets.
U.S. President Donald Trump threatened further strikes against Iran on Monday after the first exchange of direct attacks in a month, raising tensions in a conflict that had recently shifted into an economic standoff.
Iran launched missiles overnight at two U.S. air bases in Jordan in response to a U.S. attack on Iran’s Larak Island. The fresh escalation lifted Brent crude futures to $91 per barrel.
Asian stocks were little changed as selling drove global bond yields to major new highs on Tuesday on renewed fighting in the Middle East.
The 50-stock index lost 1.2% in August on Middle East jitters, with heavyweights HDFC Bank and Reliance Industries dragging.
The focus on Tuesday will also be on weekly expiry of Nifty 50 derivatives contracts. India’s new closing auction session for stocks with derivatives contracts has led to sharp swings in the cash market and options segment on the benchmarks’ expiry days.
The mechanism logged increased adoption on Monday, when changes to MSCI’s indexes led to passive flows in several stocks. However, stock-specific volatility remained.
Foreign investors sold Indian shares worth 79.86 billion rupees ($839.20 million) on Monday, as per provisional data.
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