MORNING COMENTRY: Crude Slides, Nvidia in Focus – Markets Ready for the Next Big Catalyst
MUMBAI, 26 AUGUST: U.S. stocks closed higher as technology and semiconductor shares snapped back, led by the Nasdaq Composite (+0.66%), with the S&P 500 up 0.32% and the Dow notching its third straight positive session. Sentiment stayed constructive ahead of Nvidia’s earnings. AMD and Intel each gained 3%. Nvidia rose 1% ahead of its Q2 FY2027 report; consensus stands at EPS of $2.09 on revenue of $92.28 billion. As the S&P 500’s largest constituent at over $5 trillion in market cap, the print is likely to set the tone for the broader markets.
The 10-year Treasury yield fell nearly 8 basis points to below 4.63%, aided by signs the Treasury may draw down its General Account to fund an expanded long-term bond buyback program — a move that also weighed on the dollar even as EUR/USD eased slightly to $1.17.
Gold and bitcoin drew support as investors rotated toward alternative stores of value.
Crude fell sharply as Iran and Oman resumed talks on keeping the Strait of Hormuz open, overshadowing fresh U.S. secondary sanctions on Iran. Separately, Iran and Pakistan discussed restoring an interim ceasefire with the U.S., with Pakistan’s interior minister citing progress toward reopening the strait. The pullback in crude also eased pressure on bond markets and supported the equity rally.
Canada imposed retaliatory tariffs of 15–50% on U.S. goods effective September 8, paired with a C$5.4 billion support package for affected businesses and workers. The move follows fresh U.S. tariffs of up to 50% on Canadian goods, which affect an estimated $20 billion — about 5.5% — of Canada’s exports to the U.S.
The Indian rupee led Asian currency gains, appreciating 34 paise to close at 95.41, as heavy central bank intervention and tumbling crude oil prices breathed fresh life into the domestic unit. A sharp retreat in global oil prices revived broader market risk appetite, leaving the greenback struggling to sustain its early momentum as the Dollar Index (DXY) slipped beneath the 99 mark.
Nifty climbed 115 points to settle at 24,334. The index opened 44 points lower and saw two-way trade in the first half, but strong buying in the final two hours lifted it more than 200 points, closing at a day high.
In the closing auction session (CAS), Nifty surged nearly 75 points, providing a fillip to overall gains. It also helped the Nifty reclaim its 20-day DEMA, which is near 24,300. Nifty has been respecting support from the upward-sloping trendline on the weekly charts, which has now shifted up to near 24,100. However, on the upside, the 200 DEMA near 24,375 will continue to offer immediate resistance, followed by 24,600.
In derivatives, FPIs remain net short by ~90%, signalling stretched oversold positioning—raising the likelihood of short covering in the days ahead, which could offer support to the market. Indian equities are set for a mildly positive note on conducive global cues.
Morning Commentary from HDFC Securities’ Devarsh Vakil, Head of Prime Research
(Disclaimer: The information provided here is investment advice only. Investing in the markets is subject to risks and please consult your advisor before investing)
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