Indian shares to open near six-month lows as oil prices rise
- GIFT Nifty futures were at 22,819.5 points
Indian shares are expected to open flat due to rising oil prices from Middle East concerns and global macroeconomic pressures. Adani and Tata group companies are also in focus.
- Rising oil prices and their impact on India's economy.
- Regulatory developments concerning Adani group companies.
- Tata group's proposed merger plans.
Indian shares are likely to open little changed on Tuesday, after sliding to near six-month lows in the previous session, as oil prices extended their rise on continued Middle East supply worries due to the US-Iran conflict.
Brent crude futures rose 1.34% to $106.7 a barrel. Higher oil prices are detrimental for India, the world’s third-largest importer of the commodity, as they risk stoking inflation, widening the import bill and squeezing growth and corporate margins.
GIFT Nifty futures were at 22,819.5 points as of 7:51 a.m. IST, indicating a muted start for the benchmark Nifty 50 index, which closed at 22,780.25 on Monday.
Global macroeconomic concerns have largely aggravated the pressure on markets, with the surge in Brent crude, persistent foreign selling and elevated US Treasury yields as the key overhangs, spurring risk-off sentiment, said Ajit Mishra, senior vice president of research at Religare Broking.
Foreign institutional investors sold shares worth 53.53 billion rupees (about $558 million) on Monday, a four-week high. Meanwhile, domestic institutional investors purchased shares worth 51.89 billion rupees, as per provisional exchange data.
Adani, Tata firms in focus
Among stocks, Adani group companies will be in focus after the country’s market regulator disposed of proceedings against the group chairman Gautam Adani and four group companies in a case regarding public-float violations.
The case concerned whether Adani companies met the 25% minimum public-shareholding rule and properly disclosed promoter-linked holdings. The Securities and Exchange Board of India imposed penalties of 2 million rupees each on two individuals in the case for wrongful disclosures.
Tata group companies will be watched after Tata Trusts proposed merging two group companies with Tata Sons to prevent listing driven by India’s central bank.