Indian shares poised to extend rebound ahead of RBI policy verdict
- GIFT Nifty futures were trading at 22,648 points
Indian shares are set to open higher, extending a rebound driven by positive global cues, easing oil prices, and strong Q2 updates, ahead of the RBI's policy decision.
- RBI's anticipated interest rate decision.
- Global oil prices and US monetary policy easing.
- Foreign and domestic institutional investor trends.
Indian shares are likely to open higher on Tuesday, extending their rebound from the previous session as supportive global cues and positive quarterly business updates lift sentiment ahead of a crucial central bank policy decision.
GIFT Nifty futures were trading at 22,648 points, as of 7:19 a.m. IST, signalling a positive start for the benchmark Nifty 50, which closed at 22,555.75 on Monday.
The Nifty and Sensex rose about 0.6% and 0.7%, respectively, in the previous session, recovering from their longest weekly losing streak in 25 years.
The advance was aided by lower oil prices and easing concerns about aggressive US monetary tightening following softer-than-expected jobs data.
Positive quarterly updates from select financial companies underpinned the rally, while consumer and energy stocks also gained.
“Benchmark Nifty has shown signs of relief recovery after testing the crucial long-term support zone around 22,400-22,600. Going ahead, the 22,650-22,800 zone is likely to act as the immediate hurdle,” said Ajit Mishra, senior vice president of research at Religare Broking.
Attention will now turn to the Reserve Bank of India’s interest rate decision on Wednesday.
Market consensus has converged on a 25-basis-point rate hike, which would be the RBI’s first increase since February 2023, reflecting concerns over crude prices above $100 a barrel, a weakening rupee and the weakest monsoon in a decade.
Asian markets opened higher after Wall Street advanced overnight, with the tech-heavy Nasdaq Composite reaching a record high.
Brent crude futures hovered near $100 a barrel after falling $2 on Monday. Increased Middle East oil exports and a Group of Seven pledge to raise supplies weighed on prices, although disruption risks from the US-Iran war limited losses.
Foreign portfolio investors remained net sellers for a seventh consecutive session on Monday, recording outflows of 46.99 billion rupees ($488 million).
Domestic institutional investors offset the selling pressure with net inflows of 51.82 billion rupees, according to provisional NSE data.