2 weeks ago
Indian Stocks Face Weak Openings Amid Oil and Iran Tensions
India’s stock markets were expected to begin softly on both Tuesday and Wednesday.
The Sensex and Nifty had fallen during the previous trading sessions.
Oil prices went up because investors were worried that fighting or disagreements involving the US and Iran could disrupt supplies.
The temporary ceasefire between the US and Iran expired without a clear peace agreement.
The two sides also gave different accounts about whether ships could use the Strait of Hormuz.
These worries made investors more careful about buying shares.
Analysts said the Nifty could fall further if important support levels break.
They said the Bank Nifty might move within a range but could weaken below key levels.
Some analysts still suggested selected stocks for short-term or intraday trading.
For Tuesday, 18 August, Gift Nifty indicated a weak opening near 24,300, while for Wednesday, 19 August, it pointed to a muted start near 24,210.
The Sensex fell 281.09 points on Monday and another 492.70 points on Tuesday; the Nifty 50 closed at 24,287.65 and then 24,154.90.
Brent crude rose from $91.14 to $91.28 a barrel across the two reports, while WTI increased from $85.04 to $85.31.
The US-Iran ceasefire expired without a diplomatic breakthrough, while uncertainty over the Strait of Hormuz increased concerns about energy supplies.
Analysts described the Nifty and Bank Nifty outlook as cautious, while recommending stocks including ICICI Bank, TVS Motor, Lenskart, Cipla, BEML, and Polycab India.
- Who
- Indian equity investors and analysts including Ponmudi R, Ajit Mishra, Sumeet Bagadia, Ganesh Dongre, and Shiju Koothupalakkal; the US and Iran shaped the global market backdrop.
- What
- Indian benchmark indices were expected to open weakly or nearly flat as oil prices rose and US-Iran tensions continued; analysts also issued stock recommendations.
- Where
- Indian stock markets, with global developments involving the United States, Iran, Iraq, Oman, and the Strait of Hormuz.
- When
- Tuesday, 18 August, and Wednesday, 19 August, with market data referring to the preceding trading sessions.
- Why
- Higher crude prices, uncertainty over energy shipments, the expired ceasefire, rising global bond yields, and weak international markets weighed on sentiment.
US Position
Iran Position
Ceasefire and negotiations
US Position
The US ruled out extending the temporary 60-day ceasefire; Donald Trump later said negotiations with Iran were not underway.
Iran Position
Iran said diplomatic efforts had stalled and reportedly shifted toward a “fully offensive” military posture.
Strait of Hormuz shipping
US Position
Donald Trump said the Strait of Hormuz remained open to shipping and threatened military action against Oman.
Iran Position
Tehran said the waterway was closed and was negotiating with Oman on an arrangement to manage it, while saying the sides were close to an agreement.
Possibility of diplomacy
US Position
Media reports suggested Donald Trump had initiated back-channel discussions with Iran’s Islamic Revolutionary Guard Corps.
Iran Position
Iran’s reported statements emphasized stalled talks and military preparedness, although negotiations over the Strait of Hormuz were continuing.
Key facts
- Sensex close before 18 August
- 77,728.16, down 281.09 points or 0.36%
- Nifty 50 close before 18 August
- 24,287.65, down 78.35 points or 0.32%
- Sensex close before 19 August
- 77,235.46, down 492.70 points or 0.63%
- Nifty 50 close before 19 August
- 24,154.90, down 132.75 points or 0.55%
- Gift Nifty indications
- Around 24,300.5 on 18 August and around 24,211.5 on 19 August, both below the respective Nifty futures closes
- Oil prices on 19 August
- Brent at $91.28 a barrel and WTI at $85.31 a barrel
- Nifty technical levels
- Analysts identified 24,000 and 23,800 as downside levels, with 24,250 to 24,600 cited as resistance depending on the report
- Recommended stocks
- Recommendations included Radico Khaitan, Ajanta Pharma, ICICI Bank, TVS Motor, Lenskart, Welspun Corp, Cipla, Polycab India, BEML, and others
Quotes
Ponmudi R
CEO of Enrich Money
“Indian equity markets are expected to trade with a cautious bias as renewed strength in crude oil prices and persistent geopolitical uncertainty continue to weigh on investor sentiment.”
livemint.com
Ajit Mishra
Senior Vice President, Research at Religare Broking
“The Nifty 50 came close to testing its crucial medium-term moving-average support, with the 100 DEMA placed around 24,200.”
livemint.com
Sources
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