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Economic Times
6 hours ago
- Business
- Economic Times
US strikes on Iran may rattle markets: Will Nifty, Sensex react to escalating geopolitical risk?
Tired of too many ads? Remove Ads Impact on markets Oil impact Tired of too many ads? Remove Ads Dollar & safe-haven assets FIIs may turn cautious Technical View Indian equities closed the week 1.6% higher, recovering from a three-day losing streak as markets bounced back sharply on Friday. However, the mood may turn cautious on Monday amid rising geopolitical tensions, following the U.S. airstrikes on Iranian nuclear Saturday, U.S. President Donald Trump confirmed that American forces carried out coordinated airstrikes on three nuclear sites in Iran —Fordow, Natanz, and Esfahan—in an effort to dismantle Tehran's nuclear capabilities. 'All planes are now outside of Iran's space. A full payload of bombs was dropped on the primary site, Fordow. All planes are safely on their way home,' Trump said in a social media escalation is expected to weigh heavily on risk sentiment globally. According to Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, 'Markets have gradually become accustomed to geopolitical tensions. That's why, despite rising conflict, Indian markets ended the week on a positive note. However, investors are likely to remain cautious and range-bound near the 25,000 level on Nifty until there's more clarity on Iran's response.'Bathini added that Middle East developments and crude oil dynamics will be key drivers in the coming days. 'Any sharp spike in oil prices could negatively impact Indian equities in the short to medium term.'Crude oil prices have already been on the rise amid tensions in West Asia. Brent crude has surged over 15% to $77 per barrel, while WTI crude has jumped 17% to $74.9 in the past eight trading sessions. The latest U.S. strikes could add fuel to the rally, particularly if Iran retaliates or moves to block the Strait of Hormuz—a vital choke point through which nearly 20% of global oil flows.A surge in oil prices may not only raise inflationary pressures but also reduce the likelihood of near-term rate cuts, which could further dampen market the dollar has weakened this year amid fears of declining U.S. exceptionalism, analysts suggest that direct American involvement in the Iran-Israel conflict could temporarily boost the greenback due to a flight to safety. However, if the conflict widens, the dollar's direction will depend on the broader risk sentiment and U.S. economic institutional investors (FIIs), who were net buyers in May with Rs 19,860 crore inflows, have turned cautious in June. As of June 20, they have sold shares worth Rs 4,192 crore, according to NSDL VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services , said, 'FPI flows are likely to remain volatile and sensitive to geopolitical risks, especially with the West Asia war escalating.'A strong dollar and movement in U.S. bond yields could also impact FII sentiment in the near term."25k is indeed a daunting challenge. Previous attempts to clear the same had proved to be short-lived as there was hardly any follow through momentum, thus leading to a sharp withdrawal. Hence the re approach of the 25k mount is accompanied by concerns of sustainability. Being at the upper Bollinger band as well, it would require further momentum to continue the uptrend. ADX at 13.2 does not indicate strong momentum either. Nevertheless, upswing attempts may be seen initially, but may not clear the 25200-460 band. Alternatively, inability to float above 25045 could see dips, but will wait for 24865 to switch sides," said Anand James of Read: $2.4 trillion worth of gold! India's household hoard is 6x Pakistan's economy (Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)
Time of India
6 hours ago
- Business
- Time of India
US strikes on Iran may rattle markets: Will Nifty, Sensex react to escalating geopolitical risk?
Indian equities closed the week 1.6% higher, recovering from a three-day losing streak as markets bounced back sharply on Friday. However, the mood may turn cautious on Monday amid rising geopolitical tensions, following the U.S. airstrikes on Iranian nuclear sites. On Saturday, U.S. President Donald Trump confirmed that American forces carried out coordinated airstrikes on three nuclear sites in Iran—Fordow, Natanz, and Esfahan—in an effort to dismantle Tehran's nuclear capabilities. 'All planes are now outside of Iran 's space. A full payload of bombs was dropped on the primary site, Fordow. All planes are safely on their way home,' Trump said in a social media post. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Villa For Sale in Dubai Might Surprise You Villas in Dubai | Search ads Learn More Undo Impact on markets The escalation is expected to weigh heavily on risk sentiment globally. According to Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, 'Markets have gradually become accustomed to geopolitical tensions. That's why, despite rising conflict, Indian markets ended the week on a positive note. However, investors are likely to remain cautious and range-bound near the 25,000 level on Nifty until there's more clarity on Iran's response.' Bathini added that Middle East developments and crude oil dynamics will be key drivers in the coming days. 'Any sharp spike in oil prices could negatively impact Indian equities in the short to medium term.' Oil impact Crude oil prices have already been on the rise amid tensions in West Asia. Brent crude has surged over 15% to $77 per barrel, while WTI crude has jumped 17% to $74.9 in the past eight trading sessions. The latest U.S. strikes could add fuel to the rally, particularly if Iran retaliates or moves to block the Strait of Hormuz—a vital choke point through which nearly 20% of global oil flows. Live Events A surge in oil prices may not only raise inflationary pressures but also reduce the likelihood of near-term rate cuts, which could further dampen market sentiment. Dollar & safe-haven assets While the dollar has weakened this year amid fears of declining U.S. exceptionalism, analysts suggest that direct American involvement in the Iran-Israel conflict could temporarily boost the greenback due to a flight to safety. However, if the conflict widens, the dollar's direction will depend on the broader risk sentiment and U.S. economic data. FIIs may turn cautious Foreign institutional investors (FIIs), who were net buyers in May with Rs 19,860 crore inflows, have turned cautious in June. As of June 20, they have sold shares worth Rs 4,192 crore, according to NSDL data. Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services , said, 'FPI flows are likely to remain volatile and sensitive to geopolitical risks, especially with the West Asia war escalating.' A strong dollar and movement in U.S. bond yields could also impact FII sentiment in the near term. Technical View "25k is indeed a daunting challenge. Previous attempts to clear the same had proved to be short-lived as there was hardly any follow through momentum, thus leading to a sharp withdrawal. Hence the re approach of the 25k mount is accompanied by concerns of sustainability. Being at the upper Bollinger band as well, it would require further momentum to continue the uptrend. ADX at 13.2 does not indicate strong momentum either. Nevertheless, upswing attempts may be seen initially, but may not clear the 25200-460 band. Alternatively, inability to float above 25045 could see dips, but will wait for 24865 to switch sides," said Anand James of Geojit. Also Read: $2.4 trillion worth of gold! India's household hoard is 6x Pakistan's economy
India Today
6 days ago
- Business
- India Today
Sensex, Nifty rise despite Israel-Iran tensions. What's fuelling today's rally?
At a time when headlines are dominated by conflict between Iran and Israel, domestic markets are choosing calm over chaos. On Monday morning, both benchmark indices opened firm despite geopolitical concerns, with the BSE Sensex rising 170.94 points to 81,289.54 and the NSE Nifty50 gaining 62.90 points to trade at 24,781.50 as of 10:19 quiet confidence comes even as gold prices climb, and crude oil remains in focus. So, what's shielding Indian equities from the global shockwaves?advertisementRISK-OFF, BUT NO PANIC'The uncertainty stemming from the Israel-Iran conflict has created a risk-off in global markets,' said Dr VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services. 'The safe-haven buying is keeping gold firm, but interestingly there is no panic in equity markets. Markets will be severely impacted only if Iran closes the Strait of Hormuz, triggering a huge spike in crude. This appears to be a low probability event now.' It's a classic case of markets factoring in the worst — and not finding it convincing enough. With U.S. President Donald Trump hinting at de-escalation efforts over the weekend, and crude oil prices showing signs of stability, investors seem to be weighing risks carefully rather than reacting impulsively.'BUY THE DIP' PSYCHOLOGY STILL INTACTMore than just resilience, there's a sense that equity markets are adapting to recurring geopolitical shocks, and perhaps even learning to capitalise on are getting habituated to geopolitical escalations,' said Kranthi Bathini, Director – Equity Strategy at WealthMills Securities. 'Such tensions have often been short-term interruptions to rallies. Statements from the US administration about a possible de-escalation in the Iran-Israel conflict are also offering a pause to the correction. Crude has been stabilising, and some long-only money is getting channelised into the market. There's cherry-picking happening at this point.'That search for value is being fuelled by strong domestic liquidity. With sustained flows into mutual funds and relentless retail participation, the market's floor remains intact even during global BACK IN FOCUSDr Vijayakumar believes this risk-off scenario may actually present an opportunity, especially in segments where valuations haven't run away yet.'Past experience tells us that times of uncertainty and risk-off are buying opportunities for long-term investors,' he said. 'This time, the difference is that the risk-off hasn't triggered a big selloff in equities. Sustained retail buying and mutual fund inflows will keep valuations elevated for a long time. Long-term investors can use this phase to buy relatively attractively valued stocks like financials.'WHAT NEXT?While the mood is steady for now, market watchers caution that volatility could return quickly if the situation in West Asia deteriorates or oil spikes dramatically. For the Nifty, technical watchers are eyeing the 24,700–24,800 zone closely. 'We need to see Nifty holding the level of 24,700 in the medium to short term,' Bathini now, though, the Indian market appears to be moving forward with cautious optimism, not ignoring the smoke in the distance, but not fleeing from it either.(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)Trending Reel
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Business Standard
22-05-2025
- Business
- Business Standard
Why Sensex fell 1000pts, Nifty below 24,550 on May 22? Check reasons here
Why are Sensex, Nifty falling today? Indian benchmark indices – Sensex and Nifty – declined in trade on Thursday, May 22, 2025, primarily due to the global market weakness and renewed concerns over US fiscal health. The BSE Sensex fell as much as 1.23 per cent or 1,004.95 points to 80,727.11. Similarly, the NSE Nifty50 dropped 1.22 per cent or 304.35 points to 24,509.10. Broader markets, too, slipped. As of 11:30 AM, the Nifty SmallCap 100 index was down 0.40 per cent, while the Nifty MidCap 100 index slipped 0.68 per cent. Kranthi Bathini, equity strategist at WealthMills Securities, explained that the market downturn is primarily driven by weakness in global markets. Added to this are concerns over US debt, which could have a ripple effect on other economies, and a natural correction after last month's rally—together forming the key triggers behind the current decline. Echoing a similar view, Ravi Singh, SVP of retail research at Religare Broking said Indian benchmark indices started the day on a negative note, as global investor confidence weakened due US fiscal uncertainties and rising Treasury yields. Additionally, the earnings of Indian companies present a mixed outlook for fiscal year 2026. Given this, here are the top reasons behind the stock market's fall: Weak global cues Asia-Pacific markets fell Thursday, tracking overnight declines on Wall Street as investors grew cautious over mounting US fiscal concerns. At last check, Japan's Nikkei was down over 0.7 per cent, while the Topix slipped 0.5 per cent. South Korea's Kospi dropped 1.1 per cent, and Australia's ASX 200 was down 0.4 per cent. On Wall Street, all three major indexes closed lower. Investors reacted negatively to a surge in Treasury yields, triggered by concerns that a new US budget bill would further stress the country's already major deficit. The Dow Jones Industrial Average lost 1.91 per cent to 41,860.44. The S&P 500 shed 1.61 per cent to 5,844.61. The Nasdaq Composite slid 1.41 per cent to 18,872.64. The 30-year Treasury bond yield last traded near 5.09 per cent, hitting its highest level since October 2023. Meanwhile, the 10-year benchmark yield stood at 4.59 per cent. US debt woes Gita Gopinath, first deputy managing director of the International Monetary Fund (IMF), has warned that the United States is running excessively large fiscal deficits and must urgently address its 'ever-increasing' debt burden. Her remarks were published in an interview with The Financial Times on Wednesday. Gopinath's comments came shortly after Moody's downgraded the US sovereign credit rating, citing the federal government's inability to manage its growing $36 trillion debt and persistently high deficits. READ MORE Most sectors fall Barring Nifty Media, all other sectoral indices were in the red zone (trading negatively). Nifty Auto was the top laggard, down 1.4 per cent, followed by Nifty FMCG and IT, which declined 1.27 per cent and 1.11 per cent, respectively. Other sectors including Pharma, PSU Banks, Private Banks, Consumer Durables, and Oil & Gas also posted losses in the range of 0.5 to 1 per cent. Technicals According to Singh, both the Nifty and Sensex witnessed selling pressure and are down nearly 1 per cent. Notably, the Nifty has begun trading below its strong support level of 24,800, which is now likely to act as a key resistance in the near-term. Jigar S Patel, senior manager of equity research at Anand Rathi explained that Nifty recently broke below the key support level of 24,800, following a double top formation on the hourly chart, accompanied by bearish divergence. This breakdown triggered a sharp pullback of nearly 200 points. 'Looking ahead, the 24,800–25,000 zone will act as a critical resistance, while support is now seen in the 24,600–24,500 range. A sustained move above or below these levels will determine the next directional bias.' Patel added.
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Business Standard
20-05-2025
- Business
- Business Standard
Metal stocks in focus: What should investors do amid global uncertainty?
Metal stocks in focus: The base metal industry seems to be caught in a demand-supply mismatch, threatening the near-term growth outlook for related players. Besides, flip-flops in trade deal negotiations between the United States (US) and China are adding to the uncertainty, leaving analysts cautious about the metal sector. Analysts believe a troica of a supply surplus, weak demand, and strengthening of the US dollar may keep metal prices under pressure in the near-to-medium term, keeping stocks of related players sideways. "Overall, for medium-to-short-term metals stocks are going to be range-bond," said Kranti Bathini, director of equity strategy, WealthMills Securities. Notably, an increase in metal prices aids revenue per unit sold for companies extracting or selling those metals. Conversely, when metal prices fall, earnings drop and stock prices decline. Supply surplus According to International Copper Study Group (ICSG), an autonomous inter-governmental organisation which maintains database for copper prices, global copper market is projected to witness a global surplus of 289,000 tonnes in 2025 -- more than double the 138,000 tonnes recorded in 2024, and significantly higher than previous estimates of 194,000 tonnes. The growing surplus is attributed to increased mine supply and smelting capacity. On the flipside, the organisation expects uncertainties around international trade policy, especially between the US and China, to reduce copper demand. It expects refined copper consumption to grow 2.4 per cent in 2025, lower than the previous projection of 2.7 per cent and a growth of 2.8 per cent in 2024. Copper demand may further slow to 1.8 per cent in 2026—largely driven by a drop in Chinese usage, from 2 per cent this year to just 0.8 per cent next year, it forecasts. China: A key monitorable Analysts view the US-China trade, having a direct impact on China's metal demand, as the key monitorable for metal prices. China is a major global consumer of metals, particularly base metals. According to a note by Motilal Oswal Financial Services, the recently announced US-China tariffs are less severe than expected, but present a notable hurdle to global trade. This, the brokerage believes, could potentially dampen demand for key raw materials used in metal production, capping any gains in metal prices. Last week, the US and China jointly declared a 90-day pause on a portion of their existing tariffs. China agreed to lower tariffs on US goods from 125 per cent to 10 per cent, and the US affirmed to reduce tariffs on Chinese goods from 145 per cent to 30 per cent. Amid severe price volatility, Aluminium is quoting around $2,450.5 on the London Metal Exchange (LME), Copper was at $9,545, and Zinc at $2,658.5. On the bourses, however, the Nifty Metal index has rallied 10 per cent on the National Stock Exchange (NSE) since the announcement, as against the Nifty50's rise of 0.38 per cent. In May so far, the index has gained 7 per cent as against a 2.7-per cent rise in the benchmark index. "Demand trends in China, coupled with the renewed strength in the US dollar, may lead to short to medium term pressure on the metal prices," said Gaurang Shah, head investment strategist, Geojit Financial Services. Silver lining That said, the outlook for domestic metal stocks, analysts believe, remains positive from a long-term perspective. "Robust demand from infrastructure and real estate, back home, may offset weakness in global demand. These two sectors are the largest consumers of metals, both ferrous and non-ferrous," said Gaurang Shah of Geojit. He added: Some upward revision is expected for metal prices. More importantly, the input cost, which was an issue in earlier financial years, has now been lowered. So the profit margins could improve in the long-term. Investment strategy Shah recommends investors to bet on metal stocks from a long-term perspective. He remains upbeat on Tata Steel, JSW Steel, Hindalco, Vedanta, GSPL, and NMDC. Bathini suggests 'buying metal stocks on dips'. He is positive on Hindalco, Vedanta, and JSW Steel.
