Markets may open cautiously on negative cues from Asian peers

Indian stock markets are expected to open on a cautious note as cues from Asian peers are not encouraging. Nifty 50 index futures on the Singapore stock exchange is currently trading marginally up by 11 points at 10,661.  

Majority of the Asian markets are trading in the red on Tuesday with Hong Kong’s Hang Seng Index leading the fall as it has plunged 2.76% as markets reopened for trading after a holiday. China’s Shanghai Composite has dipped 0.22% and Japan’s Nikkei 225 index has edged down 0.03%.  

Back home, benchmark indices kicked off the first trading session of the second-half of the year on a positive note. However, it turned out to be a formality as indices witnessed a sharp fall in the first half of the trading session. In the second half, recovery was seen from lower levels on the back of country’s manufacturing sector improving in June at the strongest pace since December 2017. To conclude, NSE Nifty settled at 10,657 with a loss of 57 points and BSE Sensex slipped 159 points to close at 35,264. The broader market indices underperformed their larger counterparts, with the Nifty Mid-cap and Small-cap dropping 0.65% and 0.66%, respectively. On the sectoral front, weakness was seen across the board barring Nifty IT and Nifty PSU Bank. Among the losers, Nifty Metal with loss of 1.79% and Nifty Realty with fall of 1.36% were the worst hit.  

The US stocks reversed early losses to end in the green on Monday. The rebound on Wall Street was seen after release of the report from the Institute for Supply Management which stated that growth in the US manufacturing activity accelerated in the month of June. The Dow Jones Industrial Average added 36 points to close at 24,307, the S&P 500 gained 8 points to finish at 2,727 and the tech-laden Nasdaq, outperforming its counterparts, climbed 57 points to end the day at 7,568.  

It was a dismal trading session for the European indices on Monday as concerns over global trade war  persisted. The latest development in global trade war is that the European Union has threatened to inflict new retaliatory tariffs worth $294 billion if the US moves forward with tariffs on European cars. The DAX of Germany slipped 0.55%, the CAC 40 of France lost 0.89% and the UK’s FTSE 100 plummeted 1.18%.