Sensex, Nifty Set To Open Lower After Gaza Hospital Attack

Indian shares look set to open lower on Wednesday as investors ponder over risks stemming from the Israel-Hamas conflict.

Oil prices started climbing again, with both Brent crude and WTI contracts climbing more than 2 percent, after a huge explosion at a Gaza hospital derailed the diplomatic efforts led by the U.S. to mobilize support for “Israel’s right to defend itself”.

Israel blamed a failed missile from militant group Palestinian Islamic Jihad for the blast, which killed about 500 people.

The dollar stood its ground and bond yields were back near recent highs as solid U.S. data raised concerns the Federal Reserve will keep interest rates higher for longer and might even announce a hike in rates this year.

Oil companies could be in focus today after the government announced late on Tuesday night a cut in windfall tax on petroleum crude, ATF (aviation turbine fuel) and diesel.

Benchmark indexes Sensex and Nifty rose around 0.4 percent each on Tuesday to snap a three-day losing run while the rupee gained 3 paise to close at 83.24 against the dollar.

Asian markets traded mostly lower this morning ahead of Chinese GDP data due later in the day. Two-year Treasury yields steadied after reaching their highest since 2006 in the previous session.

U.S. stocks ended mixed overnight while Treasury yields rose as encouraging retail sales and industrial production data along with better-than-expected earnings from Bank of America and Goldman Sachs revived Fed rate hike fears.

The Dow inched up marginally, while the S&P 500 ended flat with a negative bias and the tech-heavy Nasdaq Composite dropped 0.3 percent.

European stocks ended little changed on Tuesday as investors reacted to a slew of downbeat earnings reports and higher bond yields.

The pan European STOXX 600 slipped marginally. The German DAX and France’s CAC 40 both ended flat with a positive bias while the U.K.’s FTSE 100 rose 0.6 percent on favourable labour market data.

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