Indian markets likely to open flat on a cautious note as oil prices jump on middle east tensions

Indian markets failed to hold record highs and snapped the three-day run to end flat in the volatile session on Tuesday. Today, markets are likely to get a cautious start amid foreign fund outflows. As per NSE data, Foreign Institutional Investors (FII) were net sellers of Indian equities worth ₹ 2,784.14 crore.

An overnight jump in crude oil prices is likely to dampen sentiments in domestic markets. Based on reports of monetary stimulus from China, the world’s top crude importer, oil prices climbed on Tuesday amid concerns that growing conflict in the Middle East could hit regional supply.

There will be some cautiousness as global rating agency S&P said India’s private sector will have to shoulder more investment responsibility for the country’s growth because India’s fiscal settings are constrained and the government might not be able to provide as much financial support as before. However, firm global cues likely to aid domestic sentiments.

Some support may come as Moody’s Analytics in its new Asia Pacific outlook noted that the Indian economy will likely grow faster at 7.1% in 2024 from 6.8% projected earlier. While the research firm kept the country’s growth forecast unchanged at 6.5% for 2025, it projected a faster growth of 6.6% in 2026.

Meanwhile, the Multi Commodity Exchange of India (MCX) has revised transaction fees for futures and options (F&O) contracts after a directive from the markets regulator SEBI. The new rates will be effective from next month.

In primary market, KRN Heat Exchanger and Refrigeration’s initial public offer (IPO) will open for subscription today. The IPO is a book built issue of ₹341.95 crore. The issue is entirely a fresh issue of 15.5 million shares.

The US markets ended higher on Tuesday shrugging off weak the onsumer confidence data, as mining stocks surged following China's announcement of a sweeping stimulus package.

Asian markets are trading mostly in green on Wednesday as a rally sparked by support measures from Beijing continued. Also, Korea's Consumer confidence data for September will be on investors’ radar.