A slight easing of tensions in West Asia and the decline in crude oil prices could support the stock market today. After falling throughout last week, the benchmark indices may open higher.
Neither the United States nor Iran has carried out attacks since Friday night. Iran said it would not launch attacks if the US refrained from doing so.
Oman and Iran are holding discussions on reopening the Strait of Hormuz. Qatar, Oman, Pakistan and other countries are also speaking with both sides in an effort to restart negotiations in Geneva.
These developments have pulled crude oil prices down from $102 a barrel to around $92. Attacks in the Red Sea have also slowed.
Meanwhile, Ukraine attacked an Iranian cargo vessel in the Caspian Sea that was returning from Russia with military supplies.
The US Federal Reserve meeting beginning tomorrow will announce its decision on Wednesday. Markets will closely watch what Federal Reserve Chair Kevin Warsh says about the possibility of raising interest rates in September.
The Bank of England will announce its monetary policy on Thursday, followed by the Bank of Japan on Friday. With crude oil prices declining, markets expect central banks to avoid raising interest rates for now.
In derivatives trading at GIFT City, GIFT Nifty closed at 23,763.00 on Friday night. It rose to 23,950 this morning, indicating that the Indian market could open with strong gains.
The southwest monsoon continues to improve. The India Meteorological Department said the rainfall deficit had narrowed to 15% as of 26 July.
Under the department’s classification, rainfall that is up to 19% above or below the long-period average is considered normal.
Kerala’s rainfall deficit, however, widened to 37%. Uttar Pradesh, Bihar, Punjab, Jharkhand, Gujarat, Karnataka, Telangana and Andhra Pradesh have recorded deficits of more than 20%.
Around 40% of India’s geographical area has received rainfall that is more than 20% below normal.
Stronger behind-the-scenes efforts to facilitate US-Iran talks supported US markets on Friday, although semiconductor companies remained under pressure.
Micron shares fell 7%. Crude oil, which had climbed to $102 a barrel, declined 4% on Friday to close at $96.78.
Elon Musk’s SpaceX and Tesla both lost more than 2% on Friday.
The Dow Jones Industrial Average gained 235.60 points, or 0.46%, to close at 51,947.25.
The S&P 500 edged up 3.68 points, or 0.05%, to close at 7,411.98. The Nasdaq Composite fell 161.87 points, or 0.64%, to 24,975.82.
US futures are trading sharply higher today.
Dow futures are up 256 points, or 0.49%. S&P 500 futures have gained 46 points, or 0.62%, while Nasdaq futures are up 325 points, or 1.16%.
In the American Depositary Receipt market in New York, HDFC Bank rose 0.43% during regular trading on Friday and gained another 0.09% in after-hours trade to close at $23.25.
ICICI Bank advanced 0.92% during the regular session and remained unchanged in after-hours trading at $29.51.
Infosys surged 4.12% during regular trading before declining 0.36% in after-hours trade to close at $11.07.
Wipro gained 5.06% during the regular session and slipped 0.01% in after-hours trading to $1.869.
European markets recorded strong gains on Friday, mainly because crude oil prices began to decline.
Relatively favourable US tariff rates also supported market sentiment.
Asian markets move in different directions
Asian markets are trading in different directions today.
South Korea’s Kospi gained 1%, while Japan’s Nikkei declined 0.45%. Australia’s benchmark index advanced 1%.
Hong Kong opened marginally lower, while Shanghai fell 0.50%.
Crude oil’s surge to $102 a barrel pushed the Indian market lower for a fifth consecutive session on Friday.
Information technology and banking stocks, however, provided some support. The mid-cap and small-cap indices ended with modest losses after recovering more than 1.2% from their intraday lows.
Foreign investors continued selling. They sold shares worth a net ₹3,892.77 crore in the cash market, while domestic institutional investors were net buyers of ₹5,453.55 crore.
Foreign investors have invested ₹14,946 crore in the Indian market so far in July. However, they have remained net sellers of ₹2,59,326 crore since January this year.
The Sensex fell 331.68 points, or 0.43%, to close at 76,059.77 on Friday. The Nifty declined 102.15 points, or 0.43%, to end at 23,767.45.
The Bank Nifty rose 101.50 points, or 0.18%, to close at 56,693.50.
The Nifty Midcap 100 declined 62.65 points, or 0.10%, to 61,622.35. The Nifty Smallcap 100 fell 61.40 points, or 0.32%, to close at 18,874.95.
More stocks declined in the broader market. On the BSE, 1,999 stocks advanced and 2,185 declined. On the NSE, 1,691 stocks rose while 1,574 fell.
The nearly 10% decline in crude oil prices and the possibility of talks in West Asia are supporting gold prices.
Concerns that the Federal Reserve meeting beginning tomorrow could result in an interest rate increase have also eased.
After moving through a volatile session on Friday, gold gained 2% to close at $4,052.50 an ounce.
It rose to $4,117 this morning before easing to around $4,105.
In Kerala, the price of 22-carat gold fell by ₹1,360 per sovereign on Friday morning. It rose by ₹440 on Saturday to reach ₹1,06,280.
Silver declined on Friday to close at $58.26 an ounce. It rose to $60.20 this morning.
Platinum was trading at $1,617, palladium at $1,256 and rhodium at $7,825.
International rubber prices declined by $0.10 on Friday.
In Bangkok, RSS-1 was quoted at $289.80 per quintal and RSS-3 at $286.40 per quintal.
In Kerala, RSS-4 remained at ₹28,200 per quintal.
Industrial metals traded lower on Friday.
Copper fell 0.94% to $13,616 a tonne. Aluminium declined 0.68% to close at $3,160.50 a tonne.
Zinc, lead and tin also fell, while nickel advanced.
Cocoa prices gained 0.55% on Friday to reach $5,330 a tonne.
The International Cocoa Organization expects production in Indonesia to increase despite the El Niño weather phenomenon. Production in West Africa is expected to decline.
Arabica coffee rose 1.51% to $3.14 a pound. Coffee inventories remain at their lowest level since March 2024.
The US Dollar Index rose on Friday to close at 101.47. It declined to 101.15 this morning.
The euro fell to $1.1377, while the pound declined to $1.3314.
The Japanese yen weakened to 163.89 against the dollar. The Chinese yuan remained at 6.77 to the dollar.
The yield on the US 10-year Treasury note rose to 4.703% this morning, its highest level since 2015.
The Indian rupee ended with a marginal gain on Friday after moving within a narrow range.
The dollar fell by one paisa to close at ₹96.56. The decline in crude oil prices could support the rupee today.
In the offshore non-deliverable forward market, the dollar was quoted at ₹96.57 this morning. The Chinese yuan stood at ₹14.26 and the euro at ₹109.80.
Crude oil prices have declined sharply after their recent surge.
There have been no new attacks in the Strait of Hormuz for the past two days. The Houthis did not carry out any attacks in the Red Sea on Sunday.
However, shipping movements remain largely suspended in both regions.
Ukraine has attacked Russian vessels not only in the Black Sea and the Sea of Azov but also in the Caspian Sea. Ukrainian drones also attacked an Iranian cargo vessel transporting military supplies from Russia.
Russian oil is currently not being transported through the Black Sea or the Sea of Azov. Despite these disruptions, crude oil prices have fallen.
Brent crude declined 4% on Friday to close at $96.78 a barrel. It fell another 5% this morning to $91.96 before recovering to $92.66.
West Texas Intermediate crude fell to $84.67 before recovering slightly.
Cryptocurrencies are recovering.
Bitcoin rose above $65,125 this morning. Ether was trading above $1,940, while Solana remained above $76.