Nifty Nears 24,000 as Trump Rejects Iran Peace Initiative

Global Markets React to US-Iran Tensions

The Indian stock market is expected to face a weak start on Monday, May 11, as the GIFT Nifty slipped close to 1% on the back of escalating tensions between the US and Iran. The US and Iran failed to reach a deal on peace proposals, which has dampened hopes of an immediate diplomatic breakthrough and brought the broader risks of supply disruption in global energy markets back into focus.

The GIFT Nifty was trading 0.9% lower at 24,023, a decline of 217 points, at 8:35 am on Monday. This indicates that the Nifty 50 is likely to open below its Friday close of 24,176.15. The US President, Donald Trump, had accused Tehran of "playing games" and dismissed Iran's response to Washington's proposals as "unacceptable" on May 10.

Despite the tensions in the Middle East, Asian stocks advanced on renewed enthusiasm around artificial intelligence-linked shares. The MSCI's Asia Pacific equities index climbed as much as 1.1% during intraday trade, supported by strong gains in semiconductor and technology stocks. South Korean equities surged to a record high, with investors betting on the country's growing role in the AI supply chain.

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However, not all technology stocks rallied. Japanese gaming giant Nintendo dropped as much as 10% after warning that rising chip prices could hurt profitability. The escalating tensions in the Middle East kept investors wary and pushed oil prices sharply higher. Brent crude jumped 3.7% to $105 per barrel, fuelling concerns over inflation and interest rates.

The 10-year US Treasury yield rose to 4.39%, while the dollar strengthened against major peers as investors sought safe-haven assets. Gold slipped amid expectations that elevated inflation could keep rates higher for longer. Foreign institutional investors (FII) offloaded Indian shares worth Rs 4,111 crore on Friday, remaining net sellers, while domestic institutional investors (DII) were net buyers for the eleventh straight session, with inflows of Rs 6,748 crore.

Key Market Performers

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These companies are expected to be in focus on Monday, May 11. Bank of Baroda posted an 11% year-on-year growth in net profit, while asset quality and core credit costs remained stable. Tata Consumer Products could rise after it projected a double-digit revenue growth in fiscal 2027 and beat March-quarter profit estimates, on steady demand for staples such as tea and salt. Hyundai Motor India reported a smaller-than-expected fall in fourth-quarter profit, aided by strong domestic and overseas demand for its high-margin sport utility vehicles.

Traders are also awaiting April inflation data, expected to reflect the impact of the protracted war that began on February 28. India's annual inflation likely moved closer to the central bank's 4% target in April as higher fuel costs from the US-Iran war started feeding into prices, a Reuters poll of economists showed. Inflation stood at 3.4% in March, with the CPI data for April due on Tuesday.