The Indian stock market benchmark indices, BSE Sensex and Nifty 50, are likely to open lower on Tuesday as concerns over the ongoing US–Iran conflict and its possible impact on the domestic economy weigh on investor sentiments overnight.

Asian markets advanced, while the US stock market closed higher overnight, supported by optimism surrounding Artificial Intelligence and continued momentum in technology stocks.

Moreover, on Monday, the Indian stock market declined sharply, extending losses for the third straight session amid broad-based selling across sectors.

Domestic Market Recap

On Monday, Indian indices closed red:

• Sensex crashed by 1,312.91 points (1.70%) to close at 76,015.28
• Nifty 50 moved down by 360.30 points (1.49%) to settle at 23,815.85

Gift Nifty

Gift Nifty was trading near 23,679, around 190 points lower than the previous Nifty futures close, hinting at a negative start for Indian markets.

Overnight Wall Street Performance

The US stock market closed higher on Monday that was led by AI optimism 

• The Dow Jones Industrial Average gained 95.31 points (0.19%) to close at 49,704.47.
• S&P 500 up by 13.91 points (0.19%), ending at 7,412.84.274.13
• The Nasdaq Composite was higher by 27.05 points (0.10%), finishing at 26,.

Crude Oil Prices

• Brent crude gained by 0.29% to $104.51/barrel
• US West Texas Intermediate (WTI) crude was trading 0.32% higher at $98.38/barrel

Overnight Major Global Events Driving Sentiment

1. US–Iran Peace Talks: US President Donald Trump said the fragile ceasefire between the United States and Iran had reached its “weakest” stage and remained on “massive life support” after he rejected Tehran’s latest proposal to end the prolonged conflict. Meanwhile, Iranian Parliament Speaker Mohammad-Bagher Ghalibaf stated that accepting the 14-point proposal was the only viable option.
2. PM Modi’s Austerity Measures: Prime Minister Narendra Modi renewed his call for economic restraint and urged citizens to support the government’s austerity measures amid disruptions caused by the US–Iran conflict. He also advised schools to consider shifting temporarily to online classes wherever feasible.
3. India’s Energy Supply: The central government said India currently holds 60 days’ worth of crude oil and natural gas reserves. Defence Minister Rajnath Singh chaired the fifth Informal Group of Ministers meeting to review the country’s energy supply situation amid the Middle East conflict.
4. Japanese Bond Yields: Benchmark Japanese Government Bond yields climbed to a 29-year high ahead of an auction of long-term debt. The 10-year JGB yield rose 2 basis points to 2.540%, its highest level since June 1997. The 30-year yield increased 2 basis points to 3.78%, while the 40-year yield edged up 1 basis point to 4.035%.

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