Indian equity markets are expected to open with limited movement on Friday despite gains in global markets and a decline in crude oil prices. Early trends in GIFT Nifty indicate that the Nifty 50 and Sensex could begin trading with limited volatility.
Global equity markets are providing positive cues, while crude oil prices continue to decline. However, US trade policy, inflation data and developments in international markets remain important factors for domestic investors. GIFT Nifty was trading around 24,440, about 25 points below the previous close of Nifty futures, indicating a cautious approach among investors during the initial trading session.
In the previous trading session, domestic markets closed marginally higher. The BSE Sensex gained 113.61 points, or 0.15%, to close at 78,079.96. The NSE Nifty 50 rose 40.10 points, or 0.16%, to 24,395.85. The market direction will depend on domestic indicators as well as global developments.
Asian markets mostly traded higher on Friday following gains on Wall Street. Japan’s Nikkei 225 rose about 1.87%, while the Topix index gained around 0.98%. South Korea’s Kospi advanced as much as 2.36%, although the Kosdaq remained weaker.
Buying in technology and other major stocks supported the broader movement across Asian markets. However, Hang Seng Index futures indicated a weaker opening in Hong Kong. The mixed performance across Asian markets could influence the opening and initial trading of Indian equities.
US equities advanced on Thursday after relatively softer producer price inflation data led investors to increase purchases of risk assets. Changes in market expectations regarding interest rates also remained significant for investors.
The Dow Jones Industrial Average rose 0.13% to close at 53,839.99. The S&P 500 gained 0.65% to reach a record closing level of 7,798.99.
Strength in technology stocks lifted the Nasdaq Composite by 0.81% to 26,803.03. The gains in US markets could influence global investor sentiment and may provide support to Indian equities.
The US Producer Price Index, or PPI, was unchanged month-on-month in July. In June, the index had declined 0.1% based on revised data. On an annual basis, PPI increased 4.7% in July, compared with 5.5% growth in June.
Investors are assessing the inflation data for indications about the future monetary policy of the US Federal Reserve. If price pressures remain contained, market expectations regarding interest rates could change further, with potential effects on emerging markets and Indian equities.
US President Donald Trump has announced tariffs of up to 100% on imports of unmanned drones and their parts. According to the White House, the tariffs could take effect within 21 days.
Another development related to US trade policy will also remain on investors’ radar. Changes in international trade and customs rules can affect global supply chains and the operations of companies across countries. Higher tariffs can create risks for global trade, manufacturing and export-oriented companies.
Crude oil prices remain under pressure amid expectations of weaker global demand and an increase in US crude oil inventories. After declining more than 2% in the previous session, Brent crude slipped about 0.08% to around $87 per barrel. WTI crude also fell about 0.06% to around $81.20 per barrel.
