Sensex, Nifty Seen Tad Lower As Oil Jumps On Tight Supply

(RTTNews) - Indian shares look set to open a tad lower on Wednesday after oil prices surged nearly 4 percent overnight, adding to worries about inflation and growth.

"Inflation has peaked and price gains are getting anchored," Reserve Bank of India Governor Shaktikanta Das said in an interview with television channel ET Now on Tuesday, adding that there is "no room for complacency".

Meanwhile, rating agency ICRA expects India's GDP to grow 13 percent year-on-year (YoY) in the first quarter of financial year 2022-23, while the State Bank of India has pegged it at 15.7 percent.

Benchmark indexes Sensex and the Nifty ended Tuesday's choppy session modestly higher, while the rupee inched up by 1 paise to close at 79.83 against the dollar. Asian markets traded mixed this morning, with benchmark indexes in China and Hong Kong falling over 1 percent, as a severe drought and power shortages in the Sichuan province spurred the closing of several major factories.

Gold held steady above $1,750 per ounce as the dollar rally paused. Oil prices eased slightly after a nearly 4 percent surge overnight as de facto OPEC leader Saudi Arabia flagged the possibility of introducing cuts to balance a market it described as "schizophrenic".

Focus is on minutes of the ECB's last policy meeting due this week and the Jackson Hold economic symposium, where Fed Chair Jerome Powell's speech may offer additional clues about the bank's outlook for the economy and interest rates.

U.S. stocks closed lower for a third straight session overnight as a slew of disappointing economic readings added to economic woes.

Business activity contracted for as second straight month in August, factory activity in the U.S. central Atlantic region contracted in the month and sales of new single-family homes plunged to a 6-1/2-year low in July, adding to concerns about economic slowdown and tighter monetary policy.

The Dow dipped half a percent, the S&P 500 eased 0.2 percent and the tech-heavy Nasdaq Composite ended flat with a negative bias.

European stocks extended losses for a third straight session on Tuesday as the region's energy crisis worsened and survey readings for euro area manufacturing and services pointed towards economic contraction in the third quarter.

The pan European Stoxx 600 shed 0.4 percent. The German DAX and France's CAC 40 index both slipped around 0.3 percent, while the U.K.'s FTSE 100 gave up 0.6 percent.