Sensex, Nifty To See Muted Start On Tepid Global Cues

(RTTNews) - Indian shares may open lower on Monday, tracking mixed global cues and sharp gains in oil prices last week on hopes of growing Chinese demand.

Defense stocks could be in focus today on expectations that Prime Minister Narendra Modi's upcoming visit to the U.S. this week would result in more cooperation across sectors, including defense and critical technologies.

Benchmark indexes Sensex and Nifty jumped 1.2 percent and 1.4 percent, respectively last week to log record closing highs on data showing falling inflation, improved industrial output and persistent capital inflows.

Asian markets traded mostly lower this morning as investors looked ahead to China's loan prime rate decision on Tuesday along with Fed Chair Jerome Powell's testimony before the House Financial Services Committee and the Senate Banking Committee due later this week for directional cues. The Bank of England's rate decision also remains on investors' radar.

Gold was little changed amid dollar strength on uncertainty over the path of U.S. monetary policy. Inflation in key parts of the U.S. service industry "remains elevated and has not shown signs of easing," the Fed said in its latest monetary policy report to Congress.

Oil prices traded lower in Asian trading after having risen over two percent last week.

U.S. stocks reversed direction to end lower on Friday after recent strong gains.

Economic data brought some cheer, with a measure of consumer sentiment rising in June to the highest level in four months while consumers' near-term inflation expectations dropped to more than a two-year low.

The tech-heavy Nasdaq Composite shed 0.7 percent, the S&P 500 slipped 0.4 percent and the Dow eased 0.3 percent.

European stocks closed higher on Friday, with signs of slowing Eurozone inflation and optimism about further stimulus from China helping underpin sentiment.

The pan European STOXX 600 added half a percent. The German DAX edged up 0.4 percent, France's CAC 40 rallied 1.3 percent and the U.K.'s FTSE 100 inched up 0.2 percent.

U.S. stock markets will be closed today for the Juneteenth holiday.