Market may open in the red tracking negative global cues

The Indian markets may open sharply lower as it is reckoned that the trade war between the US and China may go on much longer, which resulted in a sharp drop on the Wall Street and sell-off in the Asian markets. Nifty 50 index future on the Singapore stock exchange is currently trading at 10,705, down by 50 points. 

Asian stocks are down early in the Monday trading session after a record-breaking loss on the Wall Street as continued concerns about a global trade war weighed on investor sentiments. China’s Shanghai Composite led the decline as its tumbled 1.42%, followed by Hong Kong’s Hang Seng and Japan’s Nikkei 225 Index which have shed 1.27% and 0.52%, respectively. 

Back home, after a cautious start, the key benchmark indices deepened their losses as the day progressed and ended Monday’s session near the day’s low point. The NSE Nifty lost 0.55% and the BSE Sensex slipped 0.61%. Nifty breached its crucial level of 10,800 while Sensex breached its level of 35,500. The broader indices followed suit as the Nifty Mid-cap and Small-cap indices logged a loss of 0.54% and 0.62%, respectively. On the sectoral front, barring Nifty IT, all other sectors ended in the red with Nifty PSU Bank losing the most by 2.09%.  

The US stocks succumbed to heavy selling pressure on Monday after a post on Twitter by US President Donald Trump calling on trading partners to remove ‘artificial’ trade barriers and tariffs on the US goods or meet with more reciprocity by the US. Due to this, market participants overlooked a report from the US Commerce Department showing a bigger-than-expected rebound in new homes sales in the month of May. The Dow Jones Industrial Average tumbled 328 points to close at 24,253, the S&P 500 slumped 38 points to finish at 2,717 and the Nasdaq plunged 161 points to end at 7,532. 

The European stocks plunged on Monday as traders were worried about further tariffs in the global trade war and the effect of Brexit. The DAX of Germany slumped 2.46%, the CAC 40 of France slipped 1.92% and the FTSE 100 plummeted 2.26%.