Sensex, Nifty Seen Opening Flat On Fiscal Deficit Concerns

Indian shares are likely to open little changed on Monday, tracking mixed global cues and amid fiscal deficit concerns after reports that the government is considering spending an additional 2 trillion rupees ($26 billion) in the 2022/23 fiscal year.

The impact of Saturday's excise duty cuts on petrol and diesel will be Rs 1 trillion for a year and the fiscal deficit target of 6.4 percent of the GDP is unlikely to be met, Finance Minister Nirmala Sitharaman has said.

Asian markets traded mixed in cautious trade, with Hong Kong stocks leading regional losses after Beijing reported a record number of Covid cases during its current outbreak.

A weaker dollar helped lift commodity prices, with copper rising to a more than two-week high and gold hitting a more than one-week high. Oil prices remained elevated amid tight supply.

U.S. stocks seesawed before finishing mixed on Friday amidst fears of a looming recession. The Dow ended marginally higher after having plunged more tan 600 points at its worst levels.

The tech-heavy Nasdaq Composite slipped 0.3 percent, while the S&P 500 briefly fell into bear market territory before ending largely unchanged.

European stocks closed higher on Friday but still logged a negative week on concerns about inflation and growth.

The pan European Stoxx 600 gained 0.7 percent after China cut its main mortgage interest rate by the most on record and British retail sales unexpectedly rose in April.

The German DAX rose 0.7 percent, France's CAC 40 index edged up 0.2 percent and the U.K.'s FTSE 100 added 1.2 percent.

Market Analysis