Market may open in the red, courtesy weak global cues

The Indian equity markets tumbled over 1% on Tuesday, following correction in global markets and oil prices. On the sectoral front, Oil & gas, metals, auto and bank stocks were under selling pressure. The sentiments were also affected after RBI kept interest rates unchanged in its 6th bimonthly policy review; and the market is waiting for cues from the Budget 2016-17. The Sensex fell 285.83 points or 1.15% to 24,539; and the Nifty tanked 10.40 points or 1.33% to 7455.55. The broader markets were also under selling pressure with BSE midcap and smallcap indices down by 1.7% and 1.3%, respectively. Meanwhile, rupee weakening by 14 paise to 67.98 during the day against dollar also weighed on the domestic equities.

On the global front, U.S.stocks closed sharply lower Tuesday due to renewed declines in oil prices and mixed reaction to some key earnings reports. The S&P 500 dropped 36.35 points, or 1.9%, to 1,903.03. The Dow Jones Industrial Average skid 295.64 points, or 1.8%, to 16,153.54. Meanwhile, the Nasdaq Composite ended the day down by 103.42 points, or 2.2%, at 4,516.95.

Oil prices extended sharp losses for a second day by 5.5% due to a slump in oil prices following a 6% slide on Monday as hopes for a deal between OPEC and Russia on output cuts diminished. WTI crude settled at 5.5%, or USD 1.74 lower at USD 29.88 per barrel, after falling as low as USD 29.81. Brent crude closed down USD 1.52, or 4.4%, at USD 32.72 a barrel. It fell as much as 5.9% to USD 32.23 in the session.

European markets tumbled to close sharply lower on Tuesday, as concerns over oil prices returned to haunt markets. In Paris, the CAC 40 dropped 2.5% to 4,283.99; while Germany’s DAX 30 lost 1.8% to 9,581.04. The U.K’s FTSE 100 fell 2.3% to 5,922.01.

Markets in Asia opened in the red on Wednesday after Wall Street sold off as much as 2% overnight amid a plunge in oil prices. Japan’s NIKKEI 225 index dropped 1.9%, heading for its second day of declines. South Korea’s Kospi index lost 1.1%. Australia’s S&P/ASX 200 Index slid 2%. New Zealand’s benchmark gauge retreated 0.74%. Chinese markets opened firmly down, with the Shanghai composite lower by 1.14% and Hong Kong's Hang Seng index declined 3.03%.

While on domestic front, a SGX Nifty 50 index future for February series traded down 68 points at 7,398. Indian markets are likely to open in the red following other Asian markets.