Pre-Market Update: Nifty 50, Sensex Likely to Open Weak; GIFT Nifty Down 35 Points

Pre-Market Update at 7:40 AM: The Indian stock market is likely to open on a cautious to negative note on Thursday, August 27, after the benchmark indices ended lower in the previous session. Global cues, including GIFT Nifty, Asian market trends, Nvidia's earnings, crude oil prices and developments in the Strait of Hormuz, are expected to influence investor sentiment.

On Wednesday, the Sensex fell 183 points, or 0.24 per cent, to close at 77,472.94, while the Nifty 50 declined 127 points, or 0.52 per cent, to settle at 24,207.75. The market witnessed profit booking after early gains, although buying interest in Banking stocks helped Bank Nifty outperform. Meanwhile, the Nifty Midcap 100 index touched a fresh record high.

GIFT Nifty was trading around 24,360, down nearly 35 points from the previous close of Nifty futures. The trend indicated a subdued to negative start for domestic benchmark indices.

Asian markets moved higher on Thursday after Nvidia's strong outlook supported optimism surrounding artificial intelligence and technology stocks. MSCI's Asia-Pacific index rose 0.6 per cent in early trade.

South Korea's Kospi surged 2.22 per cent, while Japan's Nikkei 225 gained 0.41 per cent and the broader Topix index advanced 0.32 per cent. However, Hang Seng futures moved lower by 0.2 per cent, indicating mixed sentiment across the region.

U.S. stock futures moved higher after Nvidia and other major technology companies reported their latest earnings. Dow Jones futures gained around 242 points, or 0.5 per cent, while S&P 500 futures rose 0.6 per cent.

Nasdaq 100 futures outperformed, advancing 1.07 per cent. However, the three major U.S. indices ended Wednesday's regular trading session largely unchanged as investors remained cautious ahead of the Federal Reserve's Jackson Hole symposium.

Nvidia reported stronger-than-expected quarterly earnings, providing support to global technology and artificial intelligence stocks. The company reported revenue of USD 96.22 billion, more than double from the previous year and above analysts' estimates of USD 92.17 billion.

Its earnings per share stood at USD 2.22, compared with market expectations of USD 2.10. For the third quarter of fiscal 2027, Nvidia forecast revenue of around USD 108 billion, with a possible variation of 2 per cent in either direction.

The company also indicated that customer projections point towards strong growth ahead, reinforcing optimism over continued investment in artificial intelligence infrastructure.

Geopolitical developments in the Middle East continue to remain a key factor for global markets. Iran and Oman are reportedly working on the details of an arrangement related to the control and regulation of the Strait of Hormuz.

The strategic waterway is crucial for global energy supplies, as it handled oil and natural gas shipments accounting for nearly one-fifth of global consumption before the conflict. Any progress towards easing disruptions could improve global energy supply conditions and reduce pressure on crude oil prices.

Crude oil prices declined for another session amid expectations that progress in negotiations could eventually ease supply disruptions in the Strait of Hormuz.

Brent crude futures fell 0.7 per cent to USD 86.36 per barrel, extending their losing streak to four consecutive sessions. West Texas Intermediate crude declined 0.7 per cent to USD 81.67 per barrel and remained under pressure for the fifth straight session.

Lower crude oil prices could provide some relief to India's inflation and current account concerns, although geopolitical developments remain a key risk for energy markets.

Gold prices steadied near USD 4,600 per ounce as investors assessed inflation concerns and awaited signals from the Federal Reserve at the Jackson Hole symposium.

Spot gold rose 0.5 per cent to USD 4,615.27 per ounce, while U.S. gold futures gained 0.4 per cent to USD 4,669.50. Gold had declined sharply in the previous session after inflation data strengthened expectations that interest rates could remain elevated.

Foreign institutional investors (FIIs/FPIs) turned net buyers in the cash segment on August 26, purchasing equities worth Rs 502.63 crore. Domestic institutional investors (DIIs) remained strong buyers, recording net equity purchases of Rs 6,425.16 crore.

Overall, domestic markets are likely to take cues from global equity trends, Nvidia's earnings, crude oil movements and developments in the Middle East. Investors will also closely monitor signals from the Federal Reserve's Jackson Hole symposium for clarity on the future path of U.S. interest rates.

Disclaimer: The article is for informational purposes only and not investment advice.

What’s your strategy for today’s volatile market? Share in the comments!