Pre-Market Update: Nifty 50 Likely to Open 100 Points Lower; GIFT Nifty Signals Weak Start

The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to open lower on Friday, August 7, amid weak global cues. At 7:18 AM, GIFT Nifty was trading around 24,648, indicating a gap-down opening of nearly 100 points compared with the previous close of Nifty futures. Asian markets traded mixed, while U.S. markets ended largely unchanged overnight.

Investor sentiment remains cautious as crude oil prices continue to rise amid fresh geopolitical tensions in the Middle East. Brent crude futures climbed USD 0.99, or 1.2 per cent, to USD 83.48 per barrel, while U.S. West Texas Intermediate (WTI) crude futures gained USD 0.85, or 1.1 per cent, to USD 78.84 per barrel. The gains followed reports that Iran, in coordination with Oman, is considering new restrictions on vessels passing through the Strait of Hormuz, one of the world's most critical energy shipping routes.

According to reports, Iran is reviewing legislation that would prohibit U.S., Israeli and other vessels classified as hostile from transiting the Strait of Hormuz and impose fines of up to 20 per cent of the cargo value for violations. A senior Iranian official also indicated that Tehran is seeking transit fees of 5-7 per cent of cargo value for ships using the route, while Oman is negotiating lower charges and the U.S. continues to advocate for unrestricted passage. Any disruption in the waterway could have significant implications for global energy supplies as the strait previously handled nearly one-fifth of global crude oil and LNG shipments.

The earnings season will remain a major trigger, with more than 150 companies scheduled to announce their April-June quarter results on Friday. Key companies reporting Q1 FY27 earnings include State Bank of India, Titan Company, Hindalco Industries, Oil India and Power Finance Corporation.

Gold prices were largely steady on Friday and remained on course for their biggest weekly gain since January as investors awaited the U.S. non-farm payrolls report for clues on the Federal Reserve's interest rate path. Spot gold was quoted at USD 4,235.57 per ounce, while U.S. gold futures eased 0.1 per cent to USD 4,293.80 per ounce.

Derivatives data for the August 11 expiry indicates a Put-Call Ratio (PCR) of 0.91. Significant put open interest addition was seen at the 24,600 strike, while the highest put open interest remained at the 24,000 strike. On the call side, fresh open interest addition was recorded at the 24,700 strike, whereas the 24,600 strike witnessed notable unwinding. The highest call open interest continued to be concentrated at the 25,000 strike.

Technically, Nifty 50 is expected to remain range-bound in the near term. Immediate resistance is placed in the 24,700-24,800 zone, while the 24,500-24,400 range is expected to provide strong support. Pivot-based resistance levels are seen at 24,667, 24,684 and 24,712, while support levels are placed at 24,611, 24,594 and 24,566.

Stock-specific action is likely to continue following earnings announcements. Apollo Tyres reported a sharp rise in Q1 FY27 net profit to Rs 348.9 crore from Rs 12.9 crore a year ago, while revenue increased 12.8 per cent to Rs 7,397.8 crore. LIC posted an 8.2 per cent increase in Annual Premium Equivalent (APE) to Rs 13,692 crore, while Value of New Business (VNB) surged 61.3 per cent to Rs 3,136 crore. Siemens Energy India reported a 67.8 per cent jump in net profit to Rs 441 crore and a 39.3 per cent increase in revenue to Rs 2,486 crore.

Among other earnings, NCC reported a 12.6 per cent rise in net profit to Rs 216.4 crore, Britannia Industries posted a 13.6 per cent increase in profit to Rs 591.4 crore, while Kirloskar Oil Engines reported a decline in net profit despite double-digit revenue growth. Shipping Corporation of India, GR Infraprojects, Hindustan Construction Company, Crompton Greaves Consumer Electricals, Finolex Industries, EIH and Lloyds Engineering Works also reported their quarterly earnings. Signature Global slipped into a net loss during the quarter. TVS Motor Company expanded its global electric vehicle presence by launching the TVS iQube in Kenya.

In the derivatives segment, LIC India and Bandhan Bank remain under the F&O ban for August 7.

Institutional activity remained mixed on August 6. Foreign Institutional Investors (FIIs) were net sellers of equities worth Rs 17.86 crore, while Domestic Institutional Investors (DIIs) purchased shares worth Rs 4,013.60 crore.

On Thursday, the Nifty 50 ended nearly unchanged, gaining 11.35 points, or 0.05 per cent, to close at 24,636. The Sensex rose 373.76 points, or 0.48 per cent, to settle at 78,954.76. Bank Nifty advanced 0.56 per cent, while India VIX remained around the 12 mark, indicating relatively stable market volatility.

U.S. stock futures traded largely flat ahead of the July non-farm payrolls report. Futures linked to the S&P 500 gained 0.04 per cent, Nasdaq-100 futures rose 0.3 per cent and Dow Jones futures slipped 17 points. In the previous session, the Dow Jones fell more than 460 points, while the S&P 500 and Nasdaq Composite ended marginally lower as rising oil prices weighed on investor sentiment.

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