Weak global cues may see markets making a negative start

Indian markets are likely to make a pessimistic start amid weak global cues. Traders will be concerned as the Italian political crisis is now threatening to transform into an economic crisis. The trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty may witness a gap-down opening of 74 points around levels of 10,535.  

Stock markets across Asia plunged on Wednesday on the back of Italian political crisis. Japan’s Nikkei 225 has lost 400 points, Hong Kong’s Hang Seng has plunged 475 points and China's Shanghai Composite has dropped 47 points.   

Back home, Indian equity markets ended Tuesday’s session with notable losses as weak cues from Asian and European markets prompted traders to book profits after the three-day winning streak. The Nifty slipped 53 points but managed to hold its important psychological level of 10,600. BSE Sensex dropped 216 points and closed below the 35,000-mark. In the broader market, the Nifty Mid-cap and Small-cap dipped 0.35% and 0.25%, respectively. On the sectoral front, Nifty PSU Bank slumped 2.95% followed by Nifty Media and Nifty Bank ended as top loser. On the other hand, Nifty IT and Nifty Auto ended higher by 0.47% and 0.40%, respectively.  

After the long holiday weekend, the US stocks ended sharply lower on Tuesday as market participants reacted to fresh political uncertainty in Italy. An election looks to be in the offing as an attempt to form a caretaker government faced resistance. The Dow Jones Industrial Average plunged 392 points to 24,361, the S&P 500 dropped 31 points to 2,690 and the Nasdaq fell 37 points to 7,397.  

The European stocks fell firmly across the board on Tuesday amid concerns over the political situation in both Italy and Spain. The DAX of Germany sank 1.53%, CAC 40 of France declined 1.29% and the FTSE 100 of UK finished lower by 1.26%.