Indian shares to fall as widening Iran conflict sends oil higher
Indian shares will open lower on Wednesday, in line with global markets, as oil prices surged to a near-six-week high after the U.S. and Iran exchanged strikes overnight, intensifying the Middle East conflict and renewing concerns over inflation.
GIFT Nifty futures were at 24,033.5 points as of 7:38 a.m. IST, indicating a negative start for the Nifty 50 index, which closed at 24,055.8 on Tuesday.
Brent crude jumped 2% to $96.6 a barrel, triggering a drop in Asian markets and lifting global bond yields on worries of a near-term U.S. rate hike, which could make emerging markets less attractive for global investors. [O/R]
The U.S. said it had launched a series of airstrikes against targets in Iran overnight, prompting an Iranian response in a renewed escalation of tensions in the Middle East.
A prolonged disruption to energy flows through the region could keep oil prices elevated, sustain inflationary pressures and reinforce expectations of tighter global monetary conditions, weighing on risk assets, two analysts said.
Indian benchmarks Nifty and Sensex have fallen 0.5% and 0.4%, respectively, over the last two sessions, as global woes overpowered upbeat economic growth data.
Among stocks, Gland Pharma will be in focus after the U.S. drug regulator concluded its inspection at the drugmaker's Visakhapatnam facilities with zero observations.
Coal India is selling a 10% stake in Mahanadi Coalfields through the fully owned subsidiary's initial public offering, draft papers filed with the market regulator showed.
Engineering firm EMS could move after securing an order worth 2.19 billion rupees ($23 million).
Shares of Ujjivan Small Finance Bank will be watched after the lender said its CEO Sanjeev Nautiyal stepped down from his role due to health issues. The banking regulator approved the appointment of executive director Carol Furtado as interim CEO from September 1.
($1 = 94.9500 Indian rupees)
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