Gift Nifty Down 1%; Markets Likely to Open Muted on Iran Ceasefire Fears 

Mumbai, April 20: Indian benchmark indices, BSE Sensex and NSE Nifty, might open muted on Monday as concerns lingered that the ceasefire between the United States and Iran may not last after all. Markets will open amidst fears that Iran ceasefire deal may not hold.

On Monday, Gift Nifty futures were down in the red. The contract for April 28 expiry was trading at 24,458, down by 244.50 points or 0.99% at 08:19 am.

Middle East Conflict

The primary culprit behind this anxiety is the rapidly deteriorating situation in the Middle East. Hopes of a lasting ceasefire between the United States and Iran are hanging by a thread after Washington confirmed it had seized an Iranian cargo ship that attempted to run its naval blockade near Bandar Abbas port.

President Trump triumphantly announced the seizure on social media, declaring “We have full custody of their ship!” Tehran responded with fury, with Iranian military spokesperson warning that its armed forces would “soon respond and retaliate against this armed piracy.” Iran has also refused to participate in a second round of peace negotiations that the US had hoped to initiate before Tuesday’s ceasefire deadline, leaving diplomatic channels effectively frozen.

Oil Prices

Oil prices were caught up in the frenzy. Brent futures rallied over 6% or more than $6 to trade at $96.49 a barrel while US West Texas Intermediate advanced almost 7.8% to $90.38. The sharp recovery erased losses from the previous day when oil plunged over 9% after Strait of Hormuz – through which about a fifth of the world’s oil supplies flowed before the tensions escalated – shut its gates once again. High crude oil prices are detrimental to India – the third-largest oil importer in the world – as they fuel domestic inflation and blow up the current account deficit.

Asian Markets

Japan’s Nikkei 225 led the Asian pack higher, rallying 1% while Shanghai composite rose 0.56%. SET index in Thailand fell by 0.49% while ASX’s All Ordinaries was down by 0.05%.

Friday Closing

It was a positive close for Indian markets on Friday with Sensex ending above the 78,400-mark, jumping more than 500 points and Nifty surged back above 24,300, rallying nearly 155 points. As many as 2,952 stocks ended with gains while 1,233 stocks settled in the red.

Source:

• nseindia.com