Indian Shares Set For Weak Start As Oil Ticks Up Again

(RTTNews) - Indian shares look set to open on a sluggish note on Friday, with uncertainty over reopening the Strait of Hormuz and caution ahead of the release of all-important U.S. jobs report later in the day likely to weigh on markets.

Brent crude futures traded above $83 a barrel, building on the previous session's sharp gains, after Iran reportedly struck "hostile targets" in the Strait of Hormuz and said a deal with Oman to manage traffic through the waterway will not fully reopen the vital global trade route.

The 30-share BSE Sensex rose half a percent on Thursday while the NSE Nifty index finished marginally higher, with banks and heavyweight Reliance Industries leading the surge.

The Nifty index showed significant divergence with the Sensex for a fourth straight session following the Closing Auction Session rollout.

Market participants expect the gap to narrow and pricing inefficiencies to ease as more traders and institutions participate.

The rupee fell by 14 paise to close at 95.22 against the U.S. dollar after a modest increase in U.S. Treasury yields.

Foreign institutional investors net sold shares worth Rs 17.86 crore on Thursday, while domestic institutional investors net bought shares to the extent of 4,013.60 crore, according to provisional exchange data.

Asian markets were broadly lower this morning while the dollar held steady after bouncing overnight. Higher oil prices lifted Treasury yields while gold traded half a percent higher at $4,260 an ounce.

U.S. stocks ended lower overnight while oil and bond yields rose after reports emerged that Iran may bar U.S., Israeli and other "hostile" vessels from transiting the Strait of Hormuz, raising fresh concerns over global oil supplies.

It was said that the draft bill, which seeks to impose fines of up to 20 percent of a ship's cargo value for violations of the proposed restrictions, remains under expert review and is open to recommendations before any legislative action is taken.

Investors also digested new labor market data that showed the number of Americans filing claims for unemployment benefits increased slightly last week but remained below 200,000 for a third straight week.

The Dow dipped 0.9 percent, the S&P 500 eased 0.2 percent and the tech-heavy Nasdaq Composite finished marginally lower.

European stocks ended mixed on Thursday, failing to hold onto early gains as reports of attacks on Saudi tankers in the Red Sea and Gulf of Aden offset support from strong earnings reports.

The pan-European STOXX 600 rose 0.2 percent, marking its fourth consecutive day of gains.

While the U.K.'s FTSE 100 slipped 0.2 percent, the German DAX finished marginally higher and France's CAC 40 gained 0.4 percent.