Uncertainty over US military intervention in the Middle East conflict continues, with President Donald Trump showing no signs of offering clarity. The ambiguity has unsettled markets, with Asian indices trading lower on Thursday. The Indian markets, which had closed slightly weaker on Wednesday, are expected to open on a downward note.
Brent crude, which climbed past $77 per barrel yesterday, fell again today. Gold prices also dipped, while the US dollar strengthened.
The US Federal Reserve, assessing that economic growth is slowing while inflation is rising, kept interest rates unchanged. The Federal Funds Rate remains in the 4.25–4.50 percent range since December. The Fed committee indicated the possibility of two rate cuts before the end of the year. The decision came after Trump mocked Fed chair Jerome Powell and demanded a rate cut to around 2–2.5 percent. Powell expressed concern that the US may be heading toward stagflation, with sluggish growth and rising prices.
In derivatives trading, Gift Nifty closed at 24,809 on Wednesday night and slipped to 24,730 this morning, signalling a weak opening for the Indian market.
European markets also declined on Wednesday. Reports suggest that NatWest and Spanish bank Santander are attempting to acquire the UK’s TSB Bank. Meanwhile, the UK’s retail inflation for May fell to 3.4 percent, raising hopes that the Bank of England may cut rates today.
While the Fed’s decision to hold rates was widely expected, US markets still ended marginally lower.
Trump has begun preparations for direct US involvement in the Israel–Iran conflict, deploying more aircraft and vessels to the region and initiating the evacuation of US citizens from Israel. Iran, meanwhile, has expressed willingness to negotiate with the US, but Trump has remained noncommittal. Israeli officials claim the reduced scale of recent Iranian missile attacks is due to depleted stockpiles.
The Dow Jones Industrial Average fell 44.14 points (0.10 percent) to close at 42,171.66. The S&P 100 lost 1.85 points (0.03 percent) to end at 5980.87. The Nasdaq Composite rose 25.18 points (0.13 percent) to close at 19,546.27.
US futures are trading lower today — Dow by 0.25 percent, S&P by 0.31 percent, and Nasdaq by 0.40 percent.
Asian markets are trading lower. Japan’s Nikkei dropped 0.80 percent, while indices in Hong Kong and China also slipped.
The Middle East conflict and concerns over economic growth dragged the Indian markets down on Wednesday. Except for consumer durables, automobiles, and banks, all sectors saw declines.
The Nifty fell 41.35 points (0.17 percent) to close at 24,812.05. The Sensex shed 138.64 points (0.17 percent) to settle at 81,444.66. Bank Nifty gained 114.60 points (0.21 percent) to close at 55,828.75. The Mid Cap 100 lost 270.10 points (0.46 percent) to end at 58,109.20, while the Small Cap 100 fell 41.90 points (0.23 percent) to 18,378.45.
The broader market remained negative, with 1,460 gainers and 2,528 losers on the BSE. On the NSE, 1,026 stocks advanced while 1,850 declined.
Fifty stocks hit 52-week highs on the NSE, while 20 fell to new lows. Seventy-five stocks hit upper circuits and 83 hit lower circuits.
Foreign institutional investors were net buyers of ₹945.35 crore in the cash market on Wednesday, while domestic funds bought shares worth ₹952.81 crore.
These are days when the market is driven by war developments and related uncertainty. The Nifty is expected to find support at 24,760 and 24,715, with resistance likely at 24,910 and 25,030. Directional clarity is likely only if the index breaks out of the 24,700–25,000 zone.
Gold prices remained volatile on Wednesday, rising from $3361 to $3404 per ounce before closing at $3369.55. This morning, the price moved up to $3380. In Kerala, gold rose by ₹400 per sovereign yesterday to reach ₹74,000.
Silver prices dipped slightly from record levels, closing at $36.69 per ounce on Wednesday.
Rubber prices rose 1.35 percent internationally to 165.20 cents per kg. Cocoa fell 3.29 percent to $9,612.73 per tonne, coffee dropped 5.28 percent, while tea rose 7.03 percent.
The US dollar index closed at 98.91 yesterday and rose slightly to 98.96 this morning. In the currency market, the dollar remained strong — the euro stood at $1.1477, the pound at $1.341, and the yen at 144.86 to the dollar.
The yield on US 10-year Treasury notes declined to 4.39 percent after a slight rise in bond prices. The rupee weakened further on Wednesday, losing 24 paise to close at ₹86.48 against the dollar. China’s yuan held steady at 7.19 per dollar.
With no major new developments in the Middle East conflict, crude prices fell. Brent was trading at $76.13 this morning, WTI at $74.86, and Murban crude at $75.86. Natural gas prices dropped by half a percent.
Cryptocurrencies remained largely unchanged. Bitcoin hovered above $104,800, while Ether stayed below $2,520.
