Pre-Market Update: GIFT Nifty Signals 500-Point Gap-Down Opening for Nifty 50; Fed Keeps Interest Rates Unchanged, Crude Hits $111 Mark

Pre-Market Update at 7:48 AM: India’s benchmark indices, the Sensex and Nifty 50, are likely to open sharply lower on Thursday, tracking significant losses in global markets amid concerns over rising crude oil prices. Weak global cues continue to weigh on investor sentiment, particularly after a sharp sell-off in U.S. equities.

Asian markets were trading in the red, while the U.S. markets tumbled overnight following the Federal Reserve’s policy decision. The S&P 500 closed at its lowest level in nearly four months, reflecting growing concerns around inflation and interest rate outlook.

As of 7:27 am, GIFTY Nifty was trading around the 23,250 level, a discount of nearly 550 points from the Nifty futures’ previous close, indicating a gap-down start for the Indian stock market indices.

Asian markets traded lower on Thursday, following overnight losses on Wall Street after the U.S. Federal Reserve policy announcement and escalating tensions in the U.S.–Iran conflict, which pushed oil prices higher. Japan’s Nikkei 225 declined 2.87 per cent, while the Topix fell 1.82 per cent. South Korea’s Kospi plunged 2.05 per cent and the Kosdaq dropped 1.34 per cent. Hong Kong’s Hang Seng index was trading 1.45 per cent lower.

Among the key triggers, the U.S. Federal Reserve kept benchmark interest rates unchanged in the 3.5 per cent–3.75 per cent range for the second consecutive meeting. The Federal Open Market Committee (FOMC), led by Jerome Powell, signaled expectations of higher inflation, stable unemployment, and only one rate cut during the year.

Geopolitical tensions escalated further as the U.S.–Iran conflict intensified, with Israel also involved. Iran reportedly struck gas facilities in Qatar after Israel targeted Iran’s South Pars offshore gas field in the Persian Gulf. Reports also suggested that Israel killed Iran’s intelligence minister and continued targeting key leadership and energy infrastructure.

On the macroeconomic front, U.S. producer prices rose at their fastest pace in seven months in February. The Producer Price Index (PPI) for final demand climbed 0.7 per cent, following a 0.5 per cent increase in January and exceeding expectations of 0.3 per cent. On a year-on-year basis, PPI advanced 3.4 per cent, marking its highest growth in a year.

The U.S. dollar index edged down 0.1 per cent to 100.11, holding near its highest levels in the last four months.

From a derivatives perspective, the Put-Call Ratio (PCR) stands at 1.06. On the Put side, the 23,500 strike saw meaningful addition in open interest, along with the 23,700 strike, making 23,500 a key support level. On the Call side, significant open interest addition was observed at 23,700, 24,800, and 25,000 strikes, indicating resistance around 23,800 and 24,000 levels.

Technically, Tuesday’s low of 22,970 is expected to act as immediate support for the Nifty 50. A fall below 23,000 could trigger further downside towards 22,700 and 22,500 levels. On the upside, 23,550 is likely to act as resistance.

In the derivatives segment, Sammaan Capital and SAIL remain under the F&O ban list for March 19.

Institutional activity remained mixed on March 18. Foreign Institutional Investors (FIIs) were net sellers, offloading equities worth Rs 2,714.35 crore, while Domestic Institutional Investors (DIIs) purchased shares worth Rs 3,253.03 crore. Notably, FIIs have been net sellers for the last 14 consecutive trading sessions.

Despite global concerns, Indian markets ended higher on Wednesday, extending gains for the third straight session. The Sensex rose 633.29 points, or 0.83 per cent, to close at 76,704.13, while the Nifty 50 gained 196.65 points, or 0.83 per cent, to settle at 23,777.80.

However, U.S. equity markets closed sharply lower. The Dow Jones Industrial Average declined 1.63 per cent to 46,225.15. The S&P 500 fell 1.36 per cent to 6,624.70, while the Nasdaq Composite dropped 1.46 per cent to 22,152.42. Among major stocks, NVIDIA slipped 0.84 per cent, Apple fell 1.69 per cent, Microsoft declined 1.91 per cent, and Amazon dropped 2.48 per cent. Tesla was down 1.63 per cent, while Micron Technology plunged 4.3 per cent. AMD, however, gained 1.6 per cent.

In the bond market, U.S. Treasury yields edged higher, with the two-year yield rising to 3.69 per cent and the 10-year yield trading around 4.21 per cent.

In commodities, gold prices steadied after a sharp fall in the previous session. Spot gold rose 0.78 per cent to USD 4,857 per ounce, while silver gained 1.12 per cent to USD 76.25.

Crude oil prices remained elevated amid Middle East tensions. Brent crude rose 0.48 per cent to USD 107.65 per barrel, while U.S. West Texas Intermediate (WTI) crude surged 2.97 per cent to USD 99.18 per barrel.

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