Indian Markets Set for Muted Open as Oil Prices Rise, Wall Street Weakens

The Indian stock market was bracing for a cautious start on Friday morning as traders absorbed a mix of headwinds from overseas and the Middle East. GIFT Nifty, the futures contract that signals the direction of the benchmark indices, had fallen 101 points to 24,647—a drop of 0.41 percent—by 8 a.m. The decline suggested the Sensex and Nifty would open flat or slightly lower, a sharp reversal from Thursday's modest gains when the Sensex had climbed 373.76 points to close at 78,954.76 and the Nifty had inched up 11.35 points to 24,636.

The caution rippling through Asian markets reflected a broader unease. Investors were waiting for US employment data due later in the day, a report that could reshape expectations for the Federal Reserve's next interest-rate decision. Across the region, the mood was subdued. Japan's Nikkei 225 fell 0.9 percent, South Korea's Kospi slipped 0.5 percent, and the broadest measure of Asia-Pacific equities outside Japan was essentially flat but tracking toward a 0.4 percent loss for the week. Wall Street had closed lower on Thursday as well, with the Dow Jones falling 0.85 percent and the S&P 500 declining 0.18 percent, as traders took profits after a strong early-week rally that had pushed both indices to record highs.

Crude oil prices, meanwhile, were climbing. Brent crude futures rose 1.2 percent to $83.48 a barrel, while US West Texas Intermediate gained 1.1 percent to $78.84, extending gains of more than three dollars from the previous day. The driver was a resurgence of concern over the Strait of Hormuz, the narrow waterway through which roughly a third of the world's seaborne oil passes. Iran, working with Oman, had proposed new restrictions on vessels deemed hostile and heavy penalties for ships that violated the rules. The uncertainty was enough to keep geopolitical risk elevated and to weigh on investor sentiment globally.

Ponmudi R, chief executive of Enrich Money, captured the moment's tension. The optimism that had briefly taken hold over a possible diplomatic breakthrough in the Middle East had faded without a formal agreement in place, he noted, leaving markets vulnerable to any fresh headlines from the region. The weakness in Asian equities—Japan and South Korea both surrendering early gains—underscored how cautious global investors had become.

Domestically, there were some offsetting forces. Foreign institutional investors had continued to sell Indian equities on Thursday, but the pace had slowed considerably. They had offloaded holdings worth just 17 crore rupees, compared to heavier selling in prior sessions. More significantly, domestic institutional investors had stepped in aggressively, purchasing equities worth 4,013 crore rupees. That buying provided a counterweight to foreign selling and suggested some confidence among India-focused money managers.

Technically, the Nifty remained in a constructive structure, according to market analysts. The immediate resistance level sat at 24,700, and if the index could break through and hold above that level, momentum could build toward 24,800 to 25,000. On the downside, support was anchored at 24,600, with a secondary floor at 24,500. For now, though, the market was caught between competing forces—the pull of rising oil prices and geopolitical uncertainty against the push of domestic institutional buying and a still-intact technical setup. The day ahead would likely be defined by how those tensions resolved.