Crude oil prices edged lower despite inconclusive peace talks involving three countries seeking to ease tensions in West Asia. No fresh Houthi attacks on Saudi Arabia were reported. Meanwhile, Israel goes to the polls today, although a major change in the country's security policies is considered unlikely regardless of the election outcome.
Lower crude prices offer some relief to equity markets. However, continued selling by foreign institutional investors could weigh on Indian stocks, with early indications pointing to a weak opening on Tuesday.
In derivatives trading at GIFT City, GIFT Nifty closed at 22,655 on Monday night. It climbed to 22,672 on Tuesday morning before surrendering some gains, indicating a potentially negative start for domestic equities.
Representatives from Saudi Arabia, Turkey and Pakistan travelled to Tehran on Monday for discussions with Iranian officials aimed at preventing a further escalation of the conflict in West Asia.
The talks involved Iran's Supreme National Security Council secretary, Saudi Arabia's defence minister and Pakistan's army chief. However, Tehran offered no firm assurances beyond agreeing to continue diplomatic engagement.
An attack on a tanker in the Strait of Hormuz after the discussions underlined the limited progress achieved.
The diplomatic initiative sought to prevent a broader conflict involving the US, Israel and Iran. Some observers believe US President Donald Trump could be willing to reach an understanding before the November 3 midterm elections.
Crude prices declined marginally on Monday as traders assessed the possibility of further diplomatic efforts.
The US Federal Reserve's Federal Open Market Committee begins its two-day meeting on Tuesday, with markets largely expecting interest rates to remain unchanged.
According to the CME FedWatch figures cited in the market report, traders assigned an 89.5% probability to a status quo decision. The probability of a rate increase at the December meeting was estimated at 92.3%.
The Federal Reserve will announce its decision on Wednesday, October 28. The European Central Bank is scheduled to announce its policy decision on Thursday, followed by the Bank of Japan on Friday.
Artificial intelligence company Anthropic has filed its preliminary prospectus for an initial public offering, potentially paving the way for a Nasdaq listing in November under the ticker symbol ANT.
The company, which developed the Claude AI assistant, could seek to raise as much as $100 billion. If achieved, the offering would surpass the record established by Elon Musk's SpaceX, which raised approximately $85.8 billion in June.
Founded five years ago and led by Dario Amodei, Anthropic has recorded rapid revenue growth, although its financial losses remain substantial.
Revenue for the first half of 2026 jumped to approximately $16.3 billion from $1.2 billion in the corresponding period of 2025. However, the company reported a net loss of $80.7 billion, substantially influenced by an accounting adjustment, compared with about $13 billion a year earlier.
Anthropic had also raised around $65 billion from investors in May.
The company's IPO filing highlights the risks associated with advanced AI systems, including the possibility of autonomous technologies operating beyond human control and potentially posing an existential threat to humanity.
Earlier expectations suggested a valuation approaching $2 trillion, although the lower end of current estimates is around $1.5 trillion.
ChatGPT developer OpenAI is also reportedly preparing for a possible IPO next year.
US stocks ended Monday's session in positive territory after a volatile trading day. The major indices briefly climbed nearly 1% before giving up some of their gains.
Investor enthusiasm surrounding Anthropic's IPO filing helped support sentiment.
The Dow Jones Industrial Average gained 146.42 points, or 0.28%, to close at 52,361.58.
The S&P 500 advanced 53.09 points, or 0.70%, to 7,676.77, while the Nasdaq Composite rose 214.04 points, or 0.83%, to 26,169.38.
US stock futures were trading higher on Tuesday morning.
Dow Jones futures rose 20 points, or 0.04%, while S&P 500 futures gained 14 points, or 0.18%.
Nasdaq futures advanced 141 points, or 0.48%, suggesting continued interest in technology stocks.
Indian companies listed through American Depositary Receipts (ADRs) recorded mixed movements in New York on Monday.
HDFC Bank declined 1.72% during regular trading before gaining 1.01% in extended trading to $21.93.
ICICI Bank fell 0.61% in the regular session and remained unchanged in extended trading at $29.28.
Infosys gained 0.65% during regular trading but declined 0.88% in extended trading to $12.32.
Wipro dropped 0.95% during market hours and lost another 0.48% in extended trading, ending at $2.08.
European equities advanced strongly on Monday, supported by gains in information technology services companies.
However, companies with substantial exposure to Brazil faced selling pressure following the continuation of left-wing rule in the country.
Banco Santander and Telefónica declined by as much as 7.5%, reflecting investor concerns over their Brazilian operations.
Major Asian equity markets traded sharply higher on Tuesday.
South Korea's Kospi index surged 5%, while Japan's Nikkei advanced 2.5%.
The rally reflected improved investor sentiment across the region, although geopolitical uncertainty and energy prices remained important concerns.
Indian equities staged a strong recovery on Monday, ending higher after a volatile session. The market had declined for four consecutive trading sessions amid concerns over the West Asia conflict and rising crude oil prices.
Despite opening lower, benchmark indices recovered during the session and recorded significant gains in the closing auction. Mid-cap and small-cap stocks also recovered from early losses, suggesting an improvement in investor appetite for broader-market equities.
All major sectoral indices, except consumer durables and media, ended higher. Metal, pharmaceutical, tourism, healthcare, capital market and defence stocks were among the leading performers.
Pharmaceutical companies including Dr Reddy's Laboratories, Laurus Labs and Mankind Pharma posted strong gains. JSW Steel, Ather Energy, Coforge and Indian Overseas Bank also registered notable advances.
Among the major losers, Shriram Finance declined 4.62%, Dhanlaxmi Bank dropped 14.36%, and eMudhra fell 9.72%.
Defence-related stocks such as Apollo Micro Systems and Paras Defence advanced. Market breadth remained positive. On the BSE, 2,374 stocks gained while 2,060 declined. On the NSE, 2,058 stocks advanced against 1,512 losers.
Foreign institutional investors continued to sell Indian equities, recording net sales of ₹1,462.99 crore in the cash market on Monday.
Domestic institutional investors, however, remained net buyers, purchasing equities worth ₹2,609.57 crore.
The Sensex gained 482.92 points, or 0.66%, to close at 73,606.75. The Nifty 50 advanced 153.20 points, or 0.68%, to finish at 22,753.20. Bank Nifty rose 79.35 points, or 0.15%, to 54,366.70.
The Nifty Midcap 100 index gained 664.75 points, or 1.19%, to 56,465.40, while the Nifty Smallcap 100 advanced 245.55 points, or 1.38%, to 17,985.
Gold prices registered a modest increase on Monday as concerns over further interest rate hikes eased and crude oil prices declined slightly.
International gold prices rose $21.30, or 0.53%, to close at $4,018.20 per ounce. However, the metal slipped to $4,012 in early Tuesday trading.
In Kerala, the price of 22-carat gold increased by ₹120 per sovereign to ₹1,04,680 on Monday.
Silver closed at $54.10 per ounce. Platinum traded at $1,523 per ounce, palladium at $1,025 and rhodium at $8,625.
Natural rubber prices continued their upward movement in domestic and international markets. In Bangkok, RSS-1 rubber rose to 288.35 US cents per kg, while RSS-3 reached 284.90 US cents per kg.
In Kerala, RSS-4 rubber climbed to ₹29,350 per quintal.
Most industrial metals gained on Monday, with aluminium and nickel being the exceptions. Copper rose 0.59% to $14,500 per tonne, while aluminium declined 0.10% to $3,040.50 per tonne. Nickel prices also weakened. Tin, lead and zinc recorded gains during the session.
Cocoa prices fell 1.59% to close at $5,503 per tonne. Arabica coffee declined 2.59% to $2.995 per pound. Palm oil prices dropped 0.60% to 4,789 Malaysian ringgit per tonne.
The US dollar index strengthened on Monday, closing at 101.96. It advanced further to 102.04 in early Tuesday trading.
The euro traded at $1.166, while the British pound stood at $1.3336. The Japanese yen weakened to 157.65 against the dollar. The Chinese yuan traded at 6.67 per dollar. The yield on the benchmark US 10-year Treasury bond rose to 4.99% on Tuesday morning.
The Indian rupee extended its losses against the US dollar on Monday. The dollar appreciated by 25 paise to close at ₹95.19. In the offshore forward market, the dollar traded around ₹95.20 on Tuesday morning.
The Chinese yuan strengthened to ₹14.27, while the euro rose to ₹106.36. Continued foreign portfolio outflows and geopolitical uncertainty remained sources of pressure on the domestic currency.
Crude oil prices declined by around 1% on Monday and extended their losses in early Tuesday trading. Brent crude settled at $115.81 per barrel on Monday before declining further to $114.90 on Tuesday morning. West Texas Intermediate (WTI) crude traded at $101.10 per barrel.
Although peace talks involving Iran have yet to produce a breakthrough, the possibility of continued diplomatic engagement has provided some relief to oil markets.
For India, which relies heavily on imported crude oil, a sustained decline in prices could ease inflationary pressures, reduce the import bill and support corporate profitability.
Major cryptocurrencies continued to decline on Tuesday morning. Bitcoin slipped below $80,100, while Ether traded below $2,325. Solana also weakened, falling below $101. The decline reflected continued volatility in digital assets amid uncertainty over global monetary policy and geopolitical developments.
(Monday, October 26)
Sensex: 73,606.75 (+0.66%)
Nifty 50: 22,753.20 (+0.68%)
Bank Nifty: 54,366.70 (+0.15%)
Nifty Midcap 100: 56,465.40 (+1.19%)
Nifty Smallcap 100: 17,985.00 (+1.38%)
Dow Jones: 52,361.58 (+0.28%)
S&P 500: 7,676.77 (+0.70%)
Nasdaq Composite: 26,169.38 (+0.83%)
US dollar: ₹95.19 (+₹0.25)
Gold (per ounce): $4,018.20 (+$21.30)
Gold (per sovereign): ₹1,04,680 (+₹120)
Brent crude: $115.81 (-$0.91)
