Sensex, Nifty Set For Muted Start As Trump Issues Dire Warning For Tehran

Indian shares look set to open on a muted note Tuesday, with focus likely to remain on geopolitical and tariff headlines.

U.S. President Donald Trump abruptly cut short his attendance at the Group of Seven (G7) summit, hours after issuing a stark warning for civilians in Tehran to evacuate “immediately” as Israeli airstrikes on the Iranian capital reportedly escalated.

Shortly after Trump’s post, Iranian media reported explosions and heavy air defense activity over Tehran early Tuesday. Israel’s army warned that it had detected new missiles launched from Iran.

Meanwhile, the U.S. and Japan have made little headway in bridging gaps over tariffs at their summit on Monday, denting hopes for a trade deal between the countries.

Benchmark indexes Sensex and Nifty jumped around 0.8 percent and 0.9 percent, respectively on Monday as oil prices eased and data showed India’s wholesale price inflation eased further in May to a 14-month low, aligning with the RBI’s ongoing efforts to manage price stability. The rupee rose by 8 paise to close at 86.03 against the dollar.

Foreign institutional investors (FIIs) extended their selling streak for the fourth session and offloaded shares worth Rs 2,539 crore on a net basis Monday, while domestic institutional investors (DIIs) bought shares to the extent of Rs 5,780 crore, according to provisional data.

Asian markets were muted this morning in lackluster trade. The dollar index firmed slightly and yields on 10-year U.S. Treasuries and 2-year Treasuries dipped ahead of upcoming central bank decisions.

Oil prices climbed more than 2 percent as Trump’s warning about the Israeli-Iran conflict on social media increased the prospect of deepening unrest in the region and disruption to oil supply. Gold edged higher and held close to $3,400 per ounce.

U.S. stocks rose sharply overnight amid hopes that the escalating conflict between Israel and Iran would remain contained.

The tech-heavy Nasdaq Composite surged 1.5 percent, the S&P 500 climbed 0.9 percent and the Dow rose 0.8 percent after Iran reportedly called on U.S. President Trump to force a ceasefire in the four-day-old aerial war and the Israeli military claimed its campaign has eliminated high-value targets.

European stocks recovered from an early slide to end higher on Monday amid optimism that the Israel-Iran conflict would have limited economic impact beyond the Middle East.

The pan-European STOXX 600 edged up by 0.4 percent. The German DAX and France’s CAC 40 both gained around 0.8 percent while the U.K.’s FTSE 100 added 0.3 percent.

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