Pre-Market Update June 01: Nifty Set for Flat-to-Positive Start; Key Market Cues to Watch

Indian equity benchmark indices, Sensex and Nifty 50, are likely to start Monday’s session on a flat-to-positive note. At 7:34 am, GIFT Nifty was trading 32.50 points higher, or 0.14 per cent, at 23,722.50, indicating a mildly positive opening for domestic equities.

The expected positive bias comes after Friday’s sharp sell-off, which was largely influenced by MSCI index rebalancing. While the domestic market witnessed heavy selling pressure in the previous session, supportive global cues may help sentiment stabilise in early trade.

Asian Markets Trade Higher

Asian markets were trading firm on Monday morning. South Korea’s KOSPI jumped over 4 per cent, while Taiwan’s Taiwan Weighted Index gained 1.78 per cent. Japan’s Nikkei 225 was also trading higher, rising nearly 1 per cent. The strength across key Asian indices could offer some support to Indian equities at the opening bell.

Key Triggers to Watch for Indian Markets

US-Iran Talks Remain in Focus

Geopolitical developments around US-Iran talks will remain a key monitorable for global markets. According to Fox News, US President Donald Trump warned Iran that the US would “finish the job” if the deal collapses, even as Israel expanded its Lebanon offensive.

Iran’s Foreign Minister Abbas Araghchi said talks with the United States were still underway, but added that any agreement could be assessed only after a final outcome is reached. Meanwhile, French President Emmanuel Macron urged both Washington and Tehran to reach an agreement at the earliest.

Any further escalation or breakthrough in talks could influence crude oil prices, global risk appetite and, in turn, Indian market sentiment.

Crude Oil Stays Elevated Near USD 90

WTI crude futures rose to around USD 90 per barrel on Monday, recovering part of last week’s losses. Prices remained firm as uncertainty continued over a possible peace agreement between the US and Iran.

Over the weekend, both sides exchanged proposals seeking changes to a draft agreement that would extend the ceasefire and reopen the Strait of Hormuz. However, there was still no clarity on whether meaningful progress had been made.

President Trump also reiterated his demand that Iran halt its nuclear programme and fully restore the Strait of Hormuz as an open international shipping route. Although crude prices recently declined on hopes of a more durable agreement, they remain elevated compared with pre-conflict levels due to disruption fears around Hormuz, a key global energy transit route.

For India, higher crude prices remain a concern as they can impact inflation, currency movement and the trade deficit.

IMD Lowers Monsoon Forecast

The India Meteorological Department on Friday, May 29, lowered its forecast for the 2026 southwest monsoon to 90 per cent of the Long Period Average, compared with its earlier estimate of 92 per cent in April.

The weather department also indicated a 60 per cent probability of a deficient monsoon season. This raises concerns over drier-than-normal conditions in several regions and the possibility of drought-like stress in some pockets.

Below-normal rainfall in June, along with elevated temperatures, could also increase the risk of above-normal heatwaves across parts of the country. This may keep agriculture, rural demand, food inflation and consumption-linked sectors in focus.

Institutional Flows: FIIs Sell Heavily, DIIs Provide Support

Institutional flows will remain another important trigger for the market. On May 29, Foreign Institutional Investors were net sellers of Indian equities worth Rs 21,105.86 crore, marking their highest single-day selling in 2026.

Domestic Institutional Investors, however, provided strong support by buying equities worth Rs 16,764.14 crore in the same session.

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