Global Market Momentum Lifts Indian Equities as Banking Sector Updates Fuel Investor Interest

Indian equity markets are positioned for a steady opening on Tuesday, drawing strength from robust global cues and Q3 financial disclosures from major banking players including Axis Bank and IndusInd Bank. However, investors should brace for potential volatility triggered by geopolitical tensions, uncertain trade negotiations, and anticipation surrounding the critical Q3 earnings announcement cycle.

Global Tailwinds Support Regional Sentiment

Overnight U.S. market performance painted a broadly bullish picture for Asian investors. The Dow Jones Industrial Average surged 1.2 percent to establish a fresh record closing high, while the S&P 500 climbed 0.6 percent. The technology-focused Nasdaq Composite advanced 0.7 percent as market participants responded positively to U.S. military developments in Venezuela over the weekend, with President Trump’s calls for American energy sector rebuilding sparking optimism in the energy complex. Manufacturing data showing contraction for the tenth consecutive month failed to dampen investor enthusiasm.

European equities closed firmly higher on Monday, with the Stoxx 600 index ascending 0.9 percent. Germany’s DAX index rallied 1.3 percent, while France’s CAC 40 and the U.K.'s FTSE 100 added 0.2 percent and 0.5 percent respectively. Defense, technology and mining sectors led the regional advance.

Asian Markets Extend Winning Streak

Across Asia, China, Hong Kong and Japan pushed regional indices to record highs, extending a global rally that continues to gather momentum. The dollar steadied near a two-week peak, while precious metals remained stable with gold holding just above the $4,450 per ounce level. Crude oil retreated following Monday’s $1 barrel gain.

India’s Market Backdrop: Caution Amid Optimism

The Indian equity story presents a mixed picture. Benchmark indices—the Sensex and Nifty—declined approximately 0.4 percent and 0.3 percent respectively on Monday, as concerns over U.S. military interventions in Venezuela and fresh tariff threats from President Trump weighed on sentiment, offsetting enthusiasm over the approaching earnings season.

The rupee weakened marginally to 90.2775 per dollar, marking the fourth consecutive session of depreciation. Capital flows revealed divergent patterns: foreign institutional investors sold shares worth Rs 36 crore, while domestic institutional investors demonstrated confidence by purchasing Rs 1,764 crore worth of equities based on preliminary exchange data.

Investors face a delicate balancing act between the supportive global backdrop and persistent domestic headwinds as markets prepare for the earnings commentary that will define near-term direction for Indian shares.