Indian stock market: The domestic equity market indices, Sensex and Nifty 50, are expected to open higher on Tuesday, following upbeat global market cues after US President Donald Trump announced that Israel and Iran have agreed to a ceasefire.
Asian markets rallied, while the US stock market ended higher overnight in hopes of an early interest rate cut by the US Federal Reserve.
On Monday, the Indian stock market ended sharply lower, dragged by broad-based selloff, as escalating Israel-Iran war continues to weigh on sentiment.
The Sensex crashed 511.38 points, or 0.62%, to close at 81,896.79, while the Nifty 50 settled 140.50 points, or 0.56%, lower at 24,971.90.
“Looking ahead, in the absence of any major domestic triggers, global market performance and crude oil price movement will be key in setting the tone. Participants are advised to avoid aggressive bets and instead focus on selective stock picking based on relative strength during this consolidation phase,” said Ajit Mishra – SVP, Research, Religare Broking Ltd.
Here are key global market cues for Sensex today:
Asian Markets
Asiam markets traded higher on Tuesday after the Israel-Iran ceasefire announcement by US President Donald Trump. Japan’s Nikkei 225 rallied 1.59%, while the Topix index rose 1.32%. South Korea’s Kospi jumped 2.09% and the Kosdaq index surged 1.71%. Hong Kong’s Hang Seng index indicated a higher open.
Gift Nifty Today
Gift Nifty was trading around 25,175 level, a premium of nearly 181 points from the Nifty futures’ previous close, indicating a gap-up start for the Indian stock market indices.
Wall Street
US stock market ended higher on Monday on prospects of the US Federal Reserve cutting interest rates as early as July.
The Dow Jones Industrial Average rallied 374.96 points, or 0.89%, to 42,581.78, while the S&P 500 surged 57.33 points, or 0.96%, to 6,025.17. The Nasdaq Composite closed 183.57 points, or 0.94%, higher at 19,630.98.
Tesla share price jumped 8.2%, Nvidia shares gained 0.22%, while Fiserv stock price rose 4.4%. Northern Trust share price rallied 8.0%, while Super Micro Computer shares declined 9.8%.
Israel-Iran Ceasefire
US President Donald Trump announced a “Complete and Total CEASEFIRE” had been agreed upon between Israel and Iran, meaning an official end to what he called the “12-Day War.” According to Trump, the ceasefire will go into effect in 12 hours, and then the war would be considered “ended”.
However, Iran’s Supreme Leader, Ayatollah Ali Khamenei, said that Iran is not a nation that surrenders. Khamenei’s statement came after Iran launched missile strikes on a US military base in Qatar in retaliation—an escalation that further inflamed tensions across the region.
Crude Oil Prices
Crude oil prices tumbled to their lowest level in more than a week after US President Donald Trump announced a ceasefire between Iran and Israel.
Brent crude futures fell 3.78% to $68.78 a barrel, after falling more than 4% earlier in the session and touching its lowest level since June 11. US West Texas Intermediate crude prices slumped 3.88% to $65.85 per barrel, having hit its weakest level since June 9 earlier in the session and falling around 6%.
US PMI
US business activity slowed marginally in June, though prices increased further. S&P Global said its flash US Composite PMI Output Index slipped to 52.8 this month from 53.0 in May.
The survey’s flash manufacturing PMI was unchanged at 52.0. Economists polled by Reuters had forecast the manufacturing PMI easing to 51.0. Its flash services PMI dipped to 53.1 from 53.7 in May. Economists had forecast the services PMI falling to 53.0.
Gold Prices
Gold prices hit a near two-week low as Israel – Iran ceasefire reduced safe-haven demand for the metal. Spot gold price fell 0.6% to $3,349.89 an ounce, after hitting its lowest level since June 11. US gold futures declined 0.9% to $3,364.20.
Dollar
The dollar fell after President Trump announced a ceasefire between Israel and Iran. Against the yen, the greenback was down 0.21% at 145.79. The euro rose 0.21% to $1.1602 and sterling advanced 0.18% to $1.3551.
US Federal Reserve
US Federal Reserve Vice Chair for Supervision Michelle Bowman said the time to cut interest rates is getting nearer as risks to the job market may be on the rise, Reuters reported. “It is time to consider adjusting the policy rate,” Bowman told a gathering.
US Treasury Yields
US treasury yields fell as Federal Reserve vice-chair Michelle Bowman unexpectedly signaled the first interest rate cut this year could come as soon as July, Reuters reported. The two-year US Treasury yield fell 5.7 basis points to 3.851%. The US 10-year Treasury yield fell 3.5 bps to 4.34%, after retreating more than 6 basis points during the day.
(With inputs from Reuters)
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