Oil and yields pressure Indian shares

Indian shares are likely to open lower on Thursday after oil prices surged overnight and U.S. bond yields climbed to their highest level in almost twenty years. The rise in oil and the jump in Treasury yields have raised the possibility of another interest‑rate increase from the Federal Reserve this year. The market is reacting to higher borrowing costs and the risk of tighter global liquidity.

Across Asia, Japan’s 10‑year government bond yield hit a 30‑year high as the yen weakened. U.S. yields also rose, adding inflationary pressure. Investors are watching the U.S.–China summit that day, where a new trade truce was extended from November 10 to January 10. The extension eases fears of a tariff escalation between the two biggest economies, but the broader economic backdrop remains uncertain.

In India, the Sensex and Nifty each rose about half a percent on Wednesday, but the rupee slipped 0.1 percent to close at 95.74 per dollar. RBI deputy governor Poonam Gupta said the rupee could stabilise or even appreciate, citing solid GDP growth and a shrinking current‑account deficit. Foreign institutional investors bought shares worth Rs 1,617.45 crore, while domestic institutional investors net bought Rs 2,341.46 crore, according to provisional data.

Asian markets were mixed. The dollar index stayed near a two‑month high, and the U.S. 10‑year Treasury yield held at 5.13 percent, its strongest single‑day rise since May. Gold fell to $4,285 an ounce as inflation worries linger. Brent crude edged toward $102 a barrel, while oil prices jumped 4 percent after a U.S. president’s threat over Iran. The Dow fell 0.7 percent, and the Nasdaq Composite slipped, reflecting renewed concerns about inflation and interest rates. These shifts show how global events continue to shape market sentiment and could influence Indian investors’ decisions.