Indian shares seen higher as oil slides on Strait of Hormuz reopening hopes
Indian shares are likely to open higher on Wednesday, tracking gains in global equities, as oil prices fell on hopes the Strait of Hormuz could reopen after Iran resumed talks with neighbouring Oman on managing the strategic waterway.
GIFT Nifty futures were at 24,557.5 points, as of 7:32 a.m. IST, indicating a positive start for the Nifty 50, which closed at 24,334.55 on Tuesday.
Brent crude fell 2.6% to $86.3 a barrel after Iran and Oman said they discussed a joint temporary navigational corridor through the Strait and agreed to clear it of mines. [O/R]
Despite the ongoing tensions, the U.S. is beginning to send personnel back to some diplomatic missions in the Middle East that were evacuated or downsized amid the conflict with Iran, two people familiar with the matter told Reuters.
An MSCI gauge of global equities rose on Tuesday and Asian markets edged higher on Wednesday. [MKTS/GLOB]
"Recent developments surrounding discussions involving Iran and Oman over the Strait of Hormuz have raised cautious optimism that supply-disruption risks could ease," said Ponmudi R, CEO, Enrich Money.
"Any further progress on that front would likely provide additional support to energy markets and broader global risk sentiment," Ponmudi said.
Domestic benchmarks logged gains in the previous session as global crude prices dipped, while volatility persisted on the day which marked the first monthly Nifty 50 derivatives expiry under the new closing-auction method.
Foreign portfolio investors (FPIs) remained net buyers of Indian stocks for the second session on Tuesday, with inflows amounting to 15.94 billion rupees ($167.06 million). Domestic institutional investors' (DII) inflows stood at 2.30 billion rupees, according to the NSE's provisional data.
STOCKS TO WATCH
** U.S. drug regulator inspects Cipla's Pithampur facility and issues seven inspectional observations in Form 483.
** India's antitrust body finds no contravention by tyre maker Ceat in the 2019 bid-rigging case.
** Delhi High Court grants stay on order issued by the food safety regulator that barred Dabur from selling food products carrying "100%" claims.
** Honasa Consumer calls off proposed acquisition of Fluence Pharma due to non-fulfilment of conditions.
($1 = 95.4125 Indian rupees)
