(fxcue news) - Indian shares look set to open on a positive note Wednesday, mirroring gains in global markets. Volatility cannot be ruled out as oil prices climbed and concerns persist over high valuations. Analysts say that forward earnings do not justify valuations, especially in sectors that are linked to government policy actions, such as defense, railways, and power. Benchmark indexes Sensex and Nifty ended a choppy session marginally lower on Tuesday, with banks and financials pacing the declines. The rupee fell by 6 paise to close at 83.50 against the dollar. Asian markets were flat to slightly higher this morning as investors eagerly await the all-important U.S. payrolls reading due Friday for clues over Fed rate-cut prospects. A cautious undertone prevailed after a private survey showed China's service activity growth hit an eight-month low in June. The dollar index and gold were little changed while Treasury yields were steady after dropping Tuesday for the first time in three sessions. Oil prices rose half a percent to hover near a two-month high after industry data showed a large U.S. crude stock draw. Overnight, U.S. stocks struggled for direction before ending on a firm note as Fed Chair Jerome Powell acknowledged progress in disinflation but added that officials need more confidence before cutting interest rates. Bond yields drifted lower as new data showed an easing in labor market conditions despite a rise in the May job openings. The S&P 500 rose 0.6 percent to end above 5,500 for the first time ever and the tech-heavy Nasdaq Composite jumped 0.8 percent to a record close while the Dow added 0.4 percent. European stocks closed lower on Tuesday, reversing some of the previous day's relief rally amid ongoing political uncertainty in France and comments from ECB President Christine Lagarde and her top economist that officials need time to weigh inflation uncertainties. The pan European STOXX 600 dipped 0.4 percent. The German DAX dropped 0.7 percent, France's CAC 40 eased 0.3 percent and the U.K.'s FTSE 100 shed 0.6 percent.