Sensex, Nifty Set For Weak Start As Bond Yields Climb

Indian shares are seen opening on a tepid note Tuesday as recession fears grip world markets.

Profit booking in large-caps due to upcoming year-end holidays and caution ahead of the release of monetary policy meeting minutes of the Reserve Bank of India (RBI) on Wednesday may also keep the markets lackluster.

Benchmark indexes Sensex and Nifty jumped around 0.8 percent each on Monday, snapping a two-day losing streak.

Asian markets traded mostly lower this morning as Treasury yields advanced on expectations of higher Fed fund rates.

Former Federal Reserve official William Dudley said on Monday it was likely interest rates could go higher even as U.S. unemployment started to creep higher.

The Bank of Japan’s policy decision is awaited later in the day, with investors awaiting any signs of a change of tone towards inflation. Earlier today, China’s central bank kept its key lending rates steady.

Gold ticked lower in Asian trade on a firmer dollar while oil extended overnight gains after reports that the U.S. is seeking to restock its Strategic Petroleum Reserve.

U.S. stocks fell for a fourth straight session on Monday as bond yields climbed amid bets the central bank will continue with its rate hikes.

In economic news, a measure of homebuilder confidence declined for the twelfth straight month, falling to its lowest reading since mid-2012.

The Dow dropped half a percent, the S&P 500 shed 0.9 percent to close at its lowest level in more than a month and the tech-heavy Nasdaq Composite fell 1.5 percent.

European stocks closed a tad higher on Monday after last week’s selloff. The pan European STOXX 600 edged up 0.3 percent.

The German DAX and the U.K.’s FTSE 100 both rose around 0.4 percent, while France’s CAC 40 index added 0.3 percent.