Nifty set for positive start; global yields, Iran tensions in focus

GIFT Nifty:

GIFT Nifty September 2026 futures were up 75 points, indicating a positive start for the Nifty 50.

The prospect of an imminent India-US trade deal supported sentiment, after US Ambassador to India Sergio Gor said the deal is almost finalised in principle, with only legal and technical details left to be resolved.

Institutional Flows:

Foreign portfolio investors (FPIs) sold shares worth Rs 542.71 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 2,124.14 crore in the Indian equity market on 21 August 2026, according to provisional data.

FPIs bought shares worth Rs 14117.65 crore in August so far, through 21 August 2026. This follows net cash purchases of Rs 6,731.97 crore in July 2026, while they were net sellers of Rs 53,957.90 crore in June 2026.

Global Markets:

Asian stocks were largely subdued on Monday, as rising government bond yields around the world continued to weigh on risk appetite. Bond yields in Japan, France and Germany have climbed to multiyear highs, while U.S. long-term yields have also remained elevated.

Investors remained concerned that the U.S.-Iran conflict could drag on, keeping oil prices elevated and adding to inflationary pressures. President Donald Trump has threatened to impose penalties on countries that continue to trade with Iran, while Treasury Secretary Scott Bessent has warned of secondary sanctions. Iran has rejected the threats, and Washington is expected to announce additional sanctions on Monday.

Treasury Secretary Scott Bessent's decision to at least double the size of planned buybacks of longer-dated government debt to $4 billion per operation from $2 billion initially offered relief to the bond market. However, the gains quickly faded, with Treasury yields rebounding as investors remained concerned about inflation, government borrowing and the broader fiscal outlook.

U.S. stocks found firmer footing on Friday after data showed continued economic resilience and a sharp acceleration in services-sector activity. The Dow Jones Industrial Average rose 0.98%, while the S&P 500 gained 0.43% and the Nasdaq Composite advanced 0.44%.

S&P Global's flash PMI showed U.S. services activity accelerated sharply in August, with the Services PMI rising to 56.8 from 54.6 in July.

In individual stocks, Ross Stores rose 4.4% after the discount retailer raised its full-year earnings guidance following better-than-expected quarterly results.

In the week ahead, investors will focus on quarterly results from AI chipmaker Nvidia, along with earnings from software companies including Intuit, Salesforce and CrowdStrike. Markets will also be watching whether Nvidia's results and outlook can sustain investor enthusiasm around artificial intelligence.

The U.S. economic calendar includes the July Personal Consumption Expenditures price index, the Federal Reserve's preferred inflation gauge, due on Wednesday, 26 August.

Markets will also turn to the Federal Reserve's Jackson Hole symposium from 27-29 August, where Fed Chair Kevin Warsh is scheduled to speak on Friday. Investors will look for clues on the outlook for interest rates, particularly after stronger-than-expected August services activity reinforced concerns about inflationary pressures.

Domestic Market:

The domestic equity benchmarks ended almost flat on Friday as persistent geopolitical tensions surrounding Iran and elevated crude oil prices kept investors cautious. Brent crude hovered around $94 a barrel, while rising bond yields in developed markets continued to weigh on risk appetite and the appeal of emerging-market equities. Selective buying in heavyweight stocks helped limit the downside, with the Nifty settling above 24,250, supported by gains in metals and private bank shares. FMCG and auto stocks, however, remained under pressure. Technically, the Nifty is likely to find support in the 24,100-24,000 zone, while the 24,300-24,400 region remains the immediate resistance band.

The S&P BSE Sensex ended flat at 77,540.83, up 3.11 points or 0.00%. The Nifty 50 index rose 20.15 points or 0.08% to 24,252.

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