Indian shares open higher, extending advance on softer oil, steady earnings

What happened

Indian shares opened higher on Tuesday, extending three sessions of gains. The Nifty 50 rose 0.60% to 23,582.25 and the Sensex rose 0.79% to 76,288.65 by 9:15 a.m. IST, helped by strong company earnings, easing crude oil prices and early signs of foreign investors returning.

Confirmed

Global impact / market context

Lower crude oil prices reduce costs for Indian companies that buy fuel and raw materials, which can support profit per sale. Foreign investors buying Indian shares again adds demand for stocks, while domestic institutions selling shares partly offsets that support.

Analyst inference

Nine of 16 major sectors gained at the open, and small-caps and mid-caps rose 0.3% and 0.5%. Brent crude traded flat near $105 a barrel after a 7% drop, as Iran talks raised hopes of ending the US-Israeli war with Iran.

Analyst inference

What to watch

1. Marico climbed 4.5% after beating its quarterly profit view on lower copra costs and healthy demand. Watch whether other companies reporting earnings also beat profit expectations. Confirmed
2. Watch whether foreign portfolio investors, which means overseas investors buying Indian shares, keep buying after Monday's net inflows of 31.15 billion rupees, equal to $328.24 million, while domestic institutions sold. Proposed
3. Watch Brent crude oil near $105 a barrel and the Iran-Qatari talks. Further price drops could lower costs for Indian companies, while a rebound could reverse the support that softer oil gives to earnings. Analyst inference

Evidence

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