Indian shares set to open marginally higher

BENGALURU (Reuters) – Indian shares are set to open higher on Tuesday, tracking an overnight rise in Wall Street while Asian markets were subdued ahead of the Bank of Japan’s (BOJ) policy decision.

India’s GIFT Nifty was down 0.05% at 19,216 as of 7:32 a.m. IST, but still above the Nifty 50’s Monday close of 19,140.90.

Wall Street equities gained over 1% each overnight, ahead of U.S. Federal Reserve policy meeting and U.S. monthly jobs data due later this week.

Asian markets were muted amid expectations that the BOJ will raise its inflation forecasts and tweak its bond yield control in a higher-for-longer global interest rate scenario. [MKTS/GLOB]

Both the Nifty 50 and Sensex have shed 2.5% this month so far, dragged by elevated U.S. yields, persistent foreign selling and worries over the Middle East conflict.

Foreign investors have offloaded 228.50 billion rupees ($2.74 billion) worth of shares in October so far – the most selling in nine months since January.

On Monday, they sold 17.62 billion rupees worth of shares on a net basis, while domestic investors bought shares for 13.28 billion rupees.

Despite this, however, the benchmarks have risen in the last two sessions, adding 1.5%, supported by earnings in key constituents as well as short-coverings. The benchmarks had lost nearly 5% in six previous sessions.

“The markets were in oversold territory last week, with the volatility index swinging between below 10 and 13,” said Deven Choksey, managing director, KRChoksey Holdings, adding that “there was bound to be short-covering”. STOCKS TO WATCH: ** Tata Motors: Co wins an arbitral award of 7.66 billion rupees with interest to compensate for its investment in the Singur plant in West Bengal.** Marico: Co misses profit estimates in September quarter, dragged by weakness in rural demand.** DLF: Co posts rise in second-quarter profit, aided by strong housing demand.** TVS Motor: Co beats September-quarter profit view, supported by electric vehicles’ segment and demand for entry-level motorbikes.

($1 = 83.2440 Indian rupees)

(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Janane Venkatraman)