Market Updates: Key Global Developments Affect Indian Stock Market

Indian Stock Market Benchmark Indices Expected to Open Lower on Monday

The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to open lower on Monday due to weakness in global markets. The escalation of the US-Iran war in the Middle East has led to a sharp increase in crude oil prices, dampening risk appetite. Asian markets have slipped, while the US stock market ended lower last week, with all three Wall Street indices declining over 1% each.

On Friday, the Indian stock market ended lower due to profit booking amid a sharp jump in crude oil prices and weakness in the rupee. The Sensex declined 160.73 points, or 0.21%, to close at 75,237.99, while the Nifty 50 settled 46.10 points, or 0.19%, lower at 23,643.50.

Global Market Cues

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Asian Markets

Asian markets traded lower on Monday amid renewed geopolitical tensions in the Middle East. Japan's Nikkei declined 1.01%, while the Topix fell 0.88%. South Korea's Kospi dropped 1.31% and Kosdaq fell more than 2%. Hong Kong's Hang Seng index futures indicated a lower opening.

US Stock Market

The US stock market ended sharply lower on Friday amid spiking crude prices and rising Treasury yields. The Dow Jones Industrial Average declined 537.29 points, or 1.07%, to 49,526.17, while the S&P 500 plunged 92.74 points, or 1.24%, to 7,408.50. The Nasdaq Composite closed 410.08 points, or 1.54%, lower at 26,225.15.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

Key US Stocks

US-Iran War

The US and Iran remain far apart on a deal to end the war and reopen the Strait of Hormuz after a drone strike caused a fire at a nuclear power plant in the United Arab Emirates. US President Donald Trump has warned that Iran must act "fast" to reach a deal.

US-China Trade Relations

The US and China have agreed to set up boards on trade and investment and build a constructive relationship of strategic stability based on fairness and reciprocity, according to a fact sheet by the White House on President Donald Trump's visit to Beijing.

US Treasury Yields

US treasury yields spiked to near their highest in a year. The yields on benchmark US 10-year notes and the two-year notes were last at 4.607% and 4.085%, respectively.

Japanese Bond Yields

Japanese government bond (JGB) yields surged on Monday, with the benchmark 10-year yield reaching levels last seen in October 1996. The yield on the 10-year JGB climbed 7.5 bps to 2.775%.

Crude Oil Prices

Crude oil prices jumped on fresh escalation in the US-Iran war. Brent crude oil price spiked 2.33% to $111.81 a barrel, while the US West Texas Intermediate (WTI) crude futures rallied 2.79% to $108.36.

Gold Rate Today

Gold prices fell to their lowest point in more than a month. Spot gold price declined 1.1% to $4,488.99 per ounce, while US gold futures for June delivery lost 1.5% to $4,493.30.

Dollar

The dollar firmed against most major currencies. The dollar index, which measures the greenback against a basket of major currencies, was a touch firmer at 99.393.