Rising geopolitical tensions in West Asia have pushed global markets back into a sharp risk-off mode. After Friday’s steep sell-off, equities across Asia opened significantly lower today, with US futures also under pressure. Early signals from GIFT Nifty derivatives trading point to a weak start for Indian benchmarks, with the index indicating a fall of over 200 points.
Crude oil prices have surged again, climbing more than 3.5 percent this morning, with Brent moving above $116 per barrel. The dollar index has strengthened past 100, while gold prices have turned volatile and edged lower in early trade.
US President Donald Trump has indicated the possibility of an agreement with Iran, claiming progress in backchannel discussions via Pakistan. However, he has simultaneously reiterated threats of seizing Iran’s oil and uranium assets. Iran, on the other hand, has accused the US of preparing for a ground war even while talks are ongoing.
Military activity continues across Iran, Israel, Kuwait and the UAE. The entry of Yemen’s Houthi group into the conflict has heightened concerns over shipping through the Red Sea, particularly the strategic Bab el-Mandeb strait.
Pakistan has stated that formal US-Iran talks could take place soon, following consultations involving Saudi Arabia, Egypt and Turkey, although details remain unclear.
The Reserve Bank of India’s latest directive aimed at stabilising the rupee is expected to put significant pressure on banks. The RBI has instructed banks not to hold net open foreign exchange positions exceeding $100 million overnight, with compliance required by April 10.
Previously, banks’ boards had the autonomy to decide open position limits—typically up to 25 percent of capital. The sudden tightening comes amid a sharp fall in the rupee this month.
Indian banks are estimated to be holding open positions worth around $400 billion, with nearly $300 billion needing to be unwound within a short window. Banks had built these positions expecting further rupee weakness through forward dollar trades. A forced unwinding could lead to substantial losses, prompting banks to seek more time from the RBI.
The rupee, which closed at ₹94.81 on Friday, is expected to open significantly stronger today, potentially near ₹93 per dollar. While this may support the currency, it could inflict heavy mark-to-market losses on banks.
Persistently high oil prices and lack of clarity on the Iran conflict dragged US markets lower on Friday, pushing the Dow Jones into correction territory.
Dow Jones fell 793.47 points (1.73%) to 45,166.64
S&P 500 dropped 108.31 points (1.67%) to 6,368.85
Nasdaq declined 459.72 points (2.15%) to 20,948.36
US futures remain under pressure this morning amid fears of escalation into a ground war.
Asian markets opened sharply lower, tracking global cues:
Japan’s Nikkei and South Korea’s Kospi fell up to 5 percent
Australia declined 1.3 percent
Hong Kong and Chinese markets also opened weak
Indian equities erased Thursday’s gains and ended sharply lower on Friday, marking the fifth consecutive week of losses. All sectors, including IT, witnessed heavy selling.
Sensex fell 1,690.23 points (2.25%) to 73,583.22
Nifty 50 dropped 486.85 points (2.09%) to 22,819.60
Bank Nifty declined 2.67% to 52,274.60
Broader markets also weakened significantly, with mid cap and small cap indices falling over 2 percent and 1.7 percent respectively.
Market breadth remained negative, with a large majority of stocks declining on both BSE and NSE.
Foreign institutional investors continued selling, offloading ₹4,367.30 crore in the cash market, while domestic institutions provided partial support with net buying of ₹3,566.15 crore.
Gold and silver remain volatile amid shifting geopolitical signals. Gold, after rising sharply on Friday, has corrected in early trade today amid a stronger dollar.
Gold closed at $4,495 per ounce on Friday, up 2.65%
It fell about 1.5 percent this morning before recovering slightly
Silver also declined after last week’s gains
The dollar index climbed above 100, reflecting safe-haven demand.
Industrial metals showed mixed trends:
Copper declined 0.51 percent
Aluminium rose 0.69 percent, supported by supply concerns after attacks on facilities in Bahrain and the UAE
Nickel and zinc weakened, while tin and lead edged higher
Rubber prices rose modestly, while coffee declined and palm oil gained. Fertiliser prices, including urea, softened.
Crude oil prices continue to rally sharply as geopolitical risks intensify. The involvement of Yemen’s Houthi group has raised concerns over disruptions in Red Sea shipping routes.
Additional supply worries emerged after Russia warned of potential disruptions to exports via Baltic ports following Ukrainian attacks.
Brent crude rose to $116.4 per barrel this morning
WTI crude stood above $103
UAE’s Murban crude surged to $117
Cryptocurrencies continued to decline amid reduced risk appetite:
Bitcoin slipped below $66,250
Ether fell below $2,000
Solana dropped below $82
Sensex: 73,583.22 (-2.25%)
Nifty 50: 22,819.60 (-2.09%)
Bank Nifty: 52,274.60 (-2.67%)
Mid cap 100: 54,097.80 (-2.23%)
Small cap 100: 15,620.00 (-1.74%)
Dow Jones: 45,166.64 (-1.73%)
S&P 500: 6,368.85 (-1.67%)
Nasdaq: 20,948.36 (-2.15%)
Dollar: ₹94.81 (+₹0.83)
Gold ($/oz): 4,495.00 (+115.80)
Gold (sovereign): ₹1,08,600 (Saturday close)
Brent crude: $112.57 (+$4.56)