Indian shares are poised to open slightly lower as oil prices rebound amid escalating tensions over the U.S.-Iran ceasefire terms. Confusion surrounds the peace proposal, with both nations seemingly interpreting it differently, leading to continued conflict in the Middle East. Israel’s military actions have intensified, raising concerns about the stability of the Strait of Hormuz, a critical oil passage, which Iran has threatened to close.

The recent rally in Indian markets, with the Sensex and Nifty surging 4% and 3.8% respectively, was driven by optimism surrounding the ceasefire and the Reserve Bank of India’s monetary policy. However, the rebound in oil prices, now nearing $97 a barrel, could reignite inflation fears, impacting earnings across energy-dependent sectors. Additionally, foreign investors net sold shares while domestic institutions stepped in to buy, indicating a shift in market sentiment.

Market professionals should monitor oil price movements closely, as sustained high levels could complicate inflation dynamics and influence central bank policies both domestically and globally.

Source: nasdaq.com