The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to open on a strong note Monday, following a rally in global markets after the United States and Iran agreed on a framework for a deal to end their war in West Asia, fuelling relief across global markets.
Asian markets surged, while the US stock market ended higher last week, following US-Iran peace deal hopes.
This week, investors will watch out for key stock market triggers, including further developments over the US-Iran peace deal, the US Federal Reserve policy, trends in crude oil prices, FPI flows, and other key domestic and global macroeconomic data releases.
On Friday, the Indian stock market ended with strong gains as investors cheered the prospects of a US-Iran deal and a sharp decline in global crude oil prices.
The Sensex jumped 1,695.40 points, or 2.30%, to close at 75,527.95, while the Nifty 50 settled 461.30 points, or 1.99%, higher at 23,622.90.
“While the recovery has improved the near-term outlook, we continue to advocate a stock-specific approach with disciplined risk management, favouring banking, financials, and pharma for long positions and selectively identifying opportunities across other sectors,” said Ajit Mishra – SVP, Research, Religare Broking Ltd.
Here are key global market cues for Sensex today:
Asian Markets
Asian markets traded higher on Monday, after the US-Iran peace deal. Japan’s Nikkei 225 rallied 3.51%, while the Topix gained 2.43%. South Korea’s Kospi jumped 4% and Kosdaq surged 2.34%. Hong Kong Hang Seng index futures indicated a flat start.
Gift Nifty Today
Gift Nifty was trading around 23,982 level, a premium of nearly 296 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 Friday on hopes for a peace deal between Iran and the United States and as SpaceX shares surged in their debut.
The Dow Jones Industrial Average rallied 353.51 points, or 0.70%, to 51,202.26, while the S&P 500 gained 37.16 points, or 0.50%, to 7,431.46. The Nasdaq Composite closed 79.18 points, or 0.31%, higher at 25,888.84. For the week, all the three major indexes surged roughly 7%.
Nvidia stock price rose 0.16%, AMD shares rallied 4.73%, Intel share price jumped 6.51%, Apple stock price fell 1.52%, Amazon shares declined 1.23%, SpaceX shares surged 19.22%, while Tesla stock price gained 1.82%.
Rocket Lab share price plunged 10.8%, Intuitive Machines shares declined 13.1% and Planet Labs tanked 8.8%.
US-Iran Peace Deal
US and Iranian officials said they had agreed on a framework to end their war, halt the US blockade of Iran and reopen the Strait of Hormuz, but left the fate of Iran’s nuclear program to further negotiations. Mediator Pakistan said the US and Iran agreed to a peace deal and an “immediate and permanent” end to military operations on all fronts, including Lebanon.
Japan Bond Yields
Japanese government bond (JGB) yields fell following the US-Iran peace deal, sending oil prices lower and easing inflation worries. The benchmark 10-year JGB yield fell 6 bps to 2.575% and the 20-year JGB yield slid 6 bps to 3.460%.
India CPI Inflation
India’s retail inflation rose to 3.93% in May from 3.48% in the preceding month due to higher food prices. Consumer Price Index (CPI) based inflation in the food basket was 4.78% in May, higher than 4.2% in April.
SpaceX Listing
SpaceX shares made a strong debut on Nasdaq on June 12, listing at $150 apiece, an 11% premium to its issue price of $135. The listing marked Wall Street’s largest public offering in history and gave Elon Musk’s company a market valuation of approximately $1.96 trillion. Following its debut, Space Exploration Technologies Corp., as the company is officially known, immediately became the sixth largest publicly listed company in the US.
Crude Oil Prices
Crude oil prices crashed more than 4% after the US and Iran reached a peace agreement to end the war and reopen the Strait of Hormuz. Brent crude oil price plunged 3.95% to $83.88 a barrel, while the US West Texas Intermediate (WTI) crude declined 4.68% to $80.91.
Gold Rate Today
Gold prices rallied after the US-Iran peace deal pushed oil prices lower and eased concerns about inflation and higher interest rates. Spot gold price gained 1.8% to $4,297.42 per ounce, while US gold futures for August delivery rose 1.9% to $4,318.10.
Dollar
The US dollar slid to a 10-day low against its major peers amid rising risk-appetite. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.31% to 99.492, the weakest level since June 5. The euro rose 0.35% to $1.1607, and Sterling strengthened 0.3% to $1.3448. The Japanese yen weakened to as much as 160.150.
(With inputs from Agencies)
