Sensex, Nifty Seen Opening Little Changed On Muted Global Cues

(RTTNews) - Indian shares are seen opening largely unchanged on Tuesday, tracking muted cues from global markets as investors brace for a potential U.S. government shutdown, digest hawkish comments from Federal Reserve officials and await key economic data for direction.

Entertainment stocks could be in focus today after U.S. President Donald Trump announced a 100 percent tariff on movies made outside the United States.

Trump also set a 10 percent tariff rate on imports of lumber and 25 percent on vanities, kitchen cabinets and upholstered wooden products that will take effect on October 14.

The tariff rates would increase to 30 percent on January 1 for upholstered wooden products and to 50 percent for kitchen cabinets and vanities imported from countries that fail to reach an agreement with the United States.

Meanwhile, Trump's sanctions on India's Chabahar port project in Iran have gone into effect.

Closer home, the Reserve Bank of India is due to announce the latest interest rate decision on Wednesday.

The central bank is widely expected to leave interest rates unchanged to support an economy facing a highly uncertain trade environment.

On the economic front, India's industrial output growth eased slightly in August after a spike in July, preliminary data from the statistical ministry showed.

The industrial production index rose 4.0 percent year-on-year, which was far less than the 5 percent increase economists had expected.

The pace of growth slowed from 4.3 percent in July, which was revised from the 3.5 percent initially estimated, and was the strongest since January.

Benchmark indexes Sensex and Nifty gave up early gains to end marginally lower on Monday as caution set in ahead of RBI's MPC meet.

The rupee settled lower by 7 paise at a record low of 88.79 against the dollar amid persistent foreign capital outflows.

Asian markets were moving in a narrow range this morning as U.S. President Trump and his Democratic opponents appeared to make little progress at a White House meeting aimed at heading off a government shutdown.

China's official gauge for manufacturing activity showed a smaller-than-expected contraction in September, helping limit regional losses, if any.

The U.S. dollar traded weak, helping gold soar to a record high above $3,840 per ounce.

Oil extended sharp overnight losses as another anticipated production increase by OPEC+ in November and the resumption of oil exports from Iraq's Kurdistan region via Turkey exacerbated concerns about a glut.

Overnight, U.S. stocks eked out modest gains as Treasury yields fell across the curve, helping offset uncertainty around trade policies as well as concerns about a looming government shutdown.

Investors also cheered data that showed pending home sales for August jumped to the highest level in five months.

The tech-heavy Nasdaq Composite gained half a percent, the S&P 500 rose 0.3 percent and the Dow closed 0.2 percent higher.

European stocks closed slightly higher on Monday, led by gains in healthcare and luxury stocks.

The pan-European Stoxx 600 gained 0.2 percent. The German DAX ended little changed with a positive bias, France's CAC 40 inched up by 0.1 percent and the U.K.'s FTS 100 added 0.2 percent.