Sensex And Nifty 50 Likely to Open on Weaker Note Due to India-Pakistan Conflict

On May 06, Foreign Institutional Investors (FIIs) were net buyers, purchasing Rs 3,794.52 crore worth of shares. Domestic Institutional Investors (DIIs) sold shares worth Rs 1,397.68 crore during the same period. 

Pre-Market Update at 8:00 AM: The Indian stock market is likely to open lower on Wednesday, following the escalation of tensions between India and Pakistan after India's Armed Forces conducted ‘Operation Sindoor’, targeting terrorist infrastructure in Pakistan.

While Asian markets saw gains, buoyed by expectations of US-China trade talks, US markets ended in the red overnight.

On Tuesday, the Indian markets ended lower amid rising Indo-Pak tensions, with the Nifty 50 slipping below the 24,400 mark.

The Sensex dropped 155.77 points, or 0.19 per cent, closing at 80,641.07, while the Nifty 50 lost 81.55 points, or 0.33 per cent, settling at 24,379.60.

Asian indices traded higher due to hopes surrounding US-China trade talks. Japan’s Nikkei 225 gained 0.22 per cent, while the Topix rose 0.38 per cent. South Korea’s Kospi added 0.32 per cent, but the Kosdaq fell 0.7 per cent. Hong Kong’s Hang Seng index futures suggested a positive opening.

The Gift Nifty was trading around the 24,350 mark, reflecting a discount of nearly 81 points from the previous Nifty futures close, indicating a weak start for Indian indices.

US stock markets ended lower for the second consecutive session on Tuesday. The Dow Jones fell by 389.83 points, or 0.95 per cent, to 40,829.00, while the S&P 500 dropped 43.48 points, or 0.77 per cent, closing at 5,606.90. The Nasdaq Composite ended 154.58 points, or 0.87 per cent, lower at 17,689.66.

Early on Wednesday, India’s Armed Forces conducted ‘Operation Sindoor’, targeting terrorist infrastructure in Pakistan and Pakistan-occupied Kashmir (PoK). Nine sites were hit, and the operation was described as “focused, measured, and non-escalatory.” The strikes were aimed at terrorist camps that planned and executed attacks on Indian soil.

US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer are set to meet China’s top economic official in Switzerland on Saturday, which could be an initial step in resolving the ongoing trade conflict.

India and the UK have agreed on a historic free trade deal. Under the agreement, India will reduce automotive tariffs to 10 per cent, from over 100 per cent, and cut import duties on UK goods such as whisky, gin, cosmetics, and medical devices.

The US trade deficit surged to a record high in March, widening 14.0 per cent to USD 140.5 billion, surpassing economists’ forecasts of USD 137.0 billion.

China’s central bank plans to cut interest rates by 10 basis points and reduce the reserve requirement ratio by 50 basis points, as announced by PBOC Governor Pan Gongsheng.

Gold prices fell as market optimism around US-China trade talks weakened demand for safe-haven assets. Spot gold fell 1.3 per cent to USD 3,386.36 an ounce, while US gold futures dropped 0.8 per cent to USD 3,395.20.

Crude oil prices rose due to weakening production in the US and rising demand in Europe and China. Brent crude futures rose 0.69 per cent to USD 62.58 a barrel, while US West Texas Intermediate crude gained 0.86 per cent to USD 59.60 a barrel.

On May 06, Foreign Institutional Investors (FIIs) were net buyers, purchasing Rs 3,794.52 crore worth of shares. Domestic Institutional Investors (DIIs) sold shares worth Rs 1,397.68 crore during the same period. 

For today, CDSL, RBL Bank and Mannapuram Finance continue to remain under the F&O ban list.

Disclaimer: The article is for informational purposes only and not investment advice.