Weak opening seen for Nifty, Sensex

Indian stocks are forecasted to open flat or slightly lower on Tuesday as markets await global cues and external factors. Analysts believe the lack of driving forces will leave the markets vulnerable to global and liquidity influences. The Nifty futures trading at 24,315 suggests a gap-down opening of 60-75 points, primarily due to the unresolved US-Iran conflict and President Donald Trump's decision not to extend the temporary ceasefire.

WTI crude oil prices hover around $84 per barrel, causing inflationary concerns for India, a major oil importer.

The Indian economy is expected to slow down in the first quarter of 2026-27, with year-on-year GDP growth shrinking to 7.0% from 7.8% in the previous quarter. Factors contributing to this slowdown include the services sector, which may decelerate to +7.9% in Q1 2026-27 from +9.9% in Q4 2025-26. Meanwhile, industrial and agricultural growth are anticipated to improve, with industrial output rising to +7.7% in Q1 2026-27 from +7.3% in Q4 2025-26, while agricultural output is expected to rise to +4.0% in Q1 2026-27 from +3.6% in Q4 2025-26.

Despite the GDP slowdown, the overall gross value added (GVA) growth in Q1 2026-27 is projected to be 7.2%, slightly higher than the expected 7.9% in Q4 2025-26. The discrepancy is attributed to a potential compression in net indirect taxes on products. Global market cues, however, remain uncertain, with Wall Street closing lower and Asian markets displaying contrasting performances. Japan's Nikkei 225 fell by 0.4% during early trading on Tuesday.

Meanwhile, geopolitical tensions continue to impact crude oil prices and market sentiment. The Iran conflict, though witnessing intermittent de-escalation, has kept oil prices volatile, raising concerns for India and other oil-importing economies. Should a lasting resolution to the conflict emerge, it could lead to a significant correction in oil prices, alleviating some macroeconomic pressures.