(RTTNews) – Indian shares may drift lower at open on Tuesday, with concerns around the ongoing U.S.-Iran war likely to keep investors on edge.
Brent crude futures climbed toward $84 a barrel, bringing gains for the week to more than 10 percent as both the U.S. and Iran continued to escalate attacks in the Strait of Hormuz.
The U.S. said it now controls the crucial waterway and will charge fees to ships for safe passage.
An Indian crew member was killed and eight others injured after Iranian missiles struck two UAE tankers in the Strat of Hormuz.
Houthis launched missiles and drones at Saudi Arabia’s Abha airport after strikes on Sanaa. Russia has sent one of its most secure airborne command aircraft to Tehran, as per flight tracking data.
U.S. President Donald Trump said he would back a Russian bill championed by the late Senator Lindsey Graham that would renew efforts to penalize buyers of Russian oil and natural gas.
Benchmark indexes Sensex and Nifty recouped early losses to end marginally higher on Monday amid strong gains in information technology stocks after TCS expanded its 20-year partnership with ABB to transform global network operations using artificial intelligence.
The rupee fell by 30 paise to close at 95.68 against the U.S. dollar after Iran’s claim of closing the Strait of Hormuz sent oil prices surging.
Foreign institutional investors turned net sellers and offloaded shares worth Rs 3,062 crore on Monday, while domestic institutional investors net bought shares to the extent of Rs 2,172 crore, according to provisional exchange data.
Asian markets were subdued in cautious trade this morning, while the dollar index held steady and gold was little changed at $4,015 an ounce ahead of the release of U.S. CPI and PPI inflation data as well as Federal Reserve Chair Kevin Warsh’s testimony before Congress that could shape the outlook for interest rates.
Money markets are pricing in nearly a 50 percent probability of a Federal Reserve rate hike in July after Governor Christopher Waller expressed caution about inflation and said a hot core inflation reading this week could prompt the FOMC to consider tightening policy at its late-July meeting.
U.S. stocks fell sharply overnight as crude oil futures soared nearly 9 percent to reach their highest level in about a month following President Trump’s announcement that he is imposing the U.S. blockade on Iranian shipping.
In an apparent policy reversal, Trump said the U.S. will impose a 20 percent fee on shipping through the Strait of Hormuz, raising concerns over shipping costs, inflation risks and interest rates.
The USA will be, from this point forward, known as ‘the guardian of the Hormuz Strait,” said the President.
The tech-heavy Nasdaq Composite slumped 1.6 percent amid a sharp sell-off in chip stocks. The S&P 500 shed 0.8 percent and the narrower Dow dipped 0.3 percent.
European stocks ended on a muted note on Monday after the U.S. Central Command hit dozens of targets at multiple locations with precision munitions and Tehran responded by attacking Gulf Arab states, further straining the fragile ceasefire between the two countries.
The pan-European STOXX 600 index closed flat with a negative bias. While the U.K.’s FTSE 100 index finished marginally higher, the German DAX edged up by 0.2 percent and France’s CAC 40 rose 0.3 percent.
