The Indian equity benchmarks, Sensex and Nifty 50, are likely to open on a weaker note this Friday as tensions intensify between India and Pakistan due to ongoing military conflict.
Asian markets showed a mixed trend, while Wall Street closed higher following a newly signed trade agreement between the US and the UK.
On Thursday, Indian markets slipped in the final trading hour, weighed down by rising geopolitical concerns after the government confirmed that Indian forces had struck multiple air defence radar sites across Pakistan.
Domestic Market Recap
On Thursday, Indian indices closed in the red, following the rising border tensions:
- Sensex slumped by 411.97 points (-0.51%) to close at 80,334.81
- Nifty 50 moved lower by 140.60 points (-0.58%) to settle at 24,273.80
Gift Nifty was trading near 23,976, around 295 points lower than the previous Nifty futures close, hinting at a negative start for Indian markets.
Wall Street Performance
US indices saw a broad growth on Thursday:
- Dow Jones: 254.48 pts (0.62%) to 41,368.45
- S&P 500: 32.66 pts (0.58%) to 5,663.94
- Nasdaq: 189.98 pts (1.07%) to 17,928.14
Gold Prices
- Spot gold gained by 0.1% to $3,309.39/oz after falling to a low of $3,288.39 in the previous session.
- US gold futures gained by 0.3% to $3,314.20
Crude Oil Prices
- Brent crude rose by 0.17% to $62.95/barrel
- US West Texas Intermediate (WTI) crude: +0.17% to $60.01/barrel
Major Global Events Driving Sentiment
- India-Pakistan Conflict: Tensions flared as Pakistani-origin drones and missiles targeted Indian military installations in Jammu, Pathankot, and Udhampur. According to the Defence Ministry, the threats were swiftly neutralised using both kinetic and non-kinetic responses. Additionally, two Pakistani drones were shot down by Indian Army Air Defence Units in the Naushera sector of J&K, amid intense cross-border artillery exchanges.
- US-UK Trade Deal: US President Donald Trump and UK Prime Minister Keir Starmer announced a limited bilateral trade agreement. While Trump’s 10% tariffs on British exports remain, the deal provides modest improvements in agricultural access and lowers steep US duties on UK car exports.
- US Jobless Claims: Weekly jobless claims in the US declined more than expected, with initial applications falling by 13,000 to 228,000 for the week ended May 3. The figure beat economists’ forecast of 230,000, suggesting continued strength in the US labour market.
- Bank of England Rate Cut: The Bank of England cut interest rates by 25 basis points to 4.25%. However, a rare 5-4 split among policymakers dampened hopes for rapid future rate cuts, as divisions within the central bank suggest caution in its monetary easing path.
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