Indian Shares Seen Flat To Higher At Open

(RTTNews) - Indian shares may see a fragile, tentative recovery at the open on Wednesday following the previous session's sell-off.

That said, a cautious undertone may prevail ahead of the U.S. Federal Reserve's interest-rate decision later in the day, with markets pricing in a 92.4 percent chance of a 25-bps rate hike.

Benchmark indexes Sensex and Nifty fell over 1 percent each on Tuesday on concerns over rising oil and U.S. bond yields amid escalating Middle East tensions.

The rupee dropped 41 paise to close at 95.96 against the U.S. dollar, logging its sharpest single-day decline in two months and extending losses for the sixth straight session after Brent crude oil prices hit $108 a barrel, rekindling concerns over inflation and India's external balance.

Foreign institutional investors (FIIs) net sold shares worth Rs 2,977.86 crore on Tuesday, while domestic institutional investors net bought shares to the extent of Rs 2,686.05 crore, according to provisional exchange data.

Asian markets were muted this morning as global concerns about artificial intelligence's rapid advancement and potential risks escalate.

The yield on the U.S. 10-year Treasury bond slipped to 4.9875 percent in early Asian trade after breaching the 5 percent mark on Tuesday for the first time in three years.

The U.S. dollar index held near a two-week high while gold was subdued below $4,300 an ounce.

Oil prices fell slightly after industry data showed an unexpected build in U.S. crude inventories.

Both Brent and WTI contracts settled more than $3 higher at their highest levels since May 19 on Tuesday amid expectations of a prolonged disruption of Saudi Arabian oil flows to its Red Sea coast following last week's drone attack on its east-west pipeline.

Concerns over global oil supplies intensified after Saudi Arabia suspended Yanbu oil loadings and cancelled some cargo deliveries to European customers.

U.S. stocks ended lower overnight on concerns about the outlook for inflation, interest rates and the U.S. government's massive debt level.

The benchmark 10-year Treasury yield briefly touched 5.041 percent, its highest level since July 2007, while oil prices hit four-month highs after reports of fresh Houth strikes on Saudi Arabia.

While the S&P 500 declined half a percent to its lowest closing level in over a month, the Dow fell 0.6 percent and the tech-heavy Nasdaq Composite shed 0.8 percent.

European stocks dropped to three-month lows on Tuesday due to oil-driven inflation fears as tensions intensified across the Middle East.

The pan-European STOXX 600 fell 0.3 percent. The German DAX slid 0.2 percent, France's CAC 40 dipped 0.3 percent and the U.K.'s FTSE 100 gave up 0.4 percent.