Indian Shares Fall as Middle East Tensions Spook Investors

The new logo of the Bombay Stock Exchange (BSE) building is seen in Mumbai, India, July 12, 2023. REUTERS/Francis Mascarenhas/File photo Purchase Licensing Rights
The new logo of the Bombay Stock Exchange (BSE) building is seen in Mumbai, India, July 12, 2023. REUTERS/Francis Mascarenhas/File photo Purchase Licensing Rights
TT

Indian Shares Fall as Middle East Tensions Spook Investors

The new logo of the Bombay Stock Exchange (BSE) building is seen in Mumbai, India, July 12, 2023. REUTERS/Francis Mascarenhas/File photo Purchase Licensing Rights
The new logo of the Bombay Stock Exchange (BSE) building is seen in Mumbai, India, July 12, 2023. REUTERS/Francis Mascarenhas/File photo Purchase Licensing Rights

Indian shares fell on Monday as investors sold riskier assets after Iran's retaliatory attack on Israel over the weekend spurred fears of a wider regional conflict.

The NSE Nifty 50 (.NSEI), opens new tab was down 0.73% at 22,354.70 as of 10:10 a.m. IST, while the S&P BSE Sensex (.BSESN), opens new tab fell 0.75% to 73,687.02.

"Risk sentiment took a hit after Iran's retaliatory attack on Israel over the weekend stoked fears of a wider conflict in the Middle East region and kept traders on edge," analysts at SMC Global Securities said in a note on Monday, Reuters reported.

"The worries in the Middle East have rattled all financial markets, pushing investors to look for safer places for their money."

Forty-one of the Nifty 50 stocks declined. All the 13 major sectors logged losses.

Shares of Indian rice and tea exporters fell amid escalations in Middle East tensions. India is one of the top exporters of basmati rice and tea, and Iran is a leading buyer of those commodities.

Other Asian peers also traded lower, with the MSCI Asia ex-Japan index (.MIAPJ0000PUS), opens new tab shedding 0.72%.

Among individual stocks, Tata Consultancy Services (TCS.NS), opens new tab, India's top software services firm by revenue, gained 0.8% and was among the top five Nifty 50 gainers.

"While the company reported lower-than-expected revenue in March quarter, we still expect TCS to lead peers on revenue growth in fiscal year 2024, aided by ramp-up of mega deals," analysts at Kotak Institutional Equities said.

Aluminium producer Hindalco Industries (HALC.NS), opens new tab gained 2.5% and was the top Nifty 50 gainer, after the US and UK imposed restrictions on the trading of new Russian commodities on the London Metals Exchange and on the Chicago Mercantile Exchange.

This (development) should be most positive for aluminium prices and shares of aluminium producers, Jefferies said.

The broader, more domestically-focussed small- (.NIFSMCP100), opens new tab and mid-caps (.NIFMDCP100), opens new tab lost about 3% and 2%, respectively, after outperforming the benchmarks in April, ahead of the session.



Maritime Disruptions Cast Shadow on Global Energy Security

A container ship passing through the Suez Canal (Suez Canal Official Website)
A container ship passing through the Suez Canal (Suez Canal Official Website)
TT

Maritime Disruptions Cast Shadow on Global Energy Security

A container ship passing through the Suez Canal (Suez Canal Official Website)
A container ship passing through the Suez Canal (Suez Canal Official Website)

As the world focuses on the Red Sea due to rising attacks on passing ships, experts warn of growing threats to the region's shipping lanes, which could impact global energy security.

Some link the disruptions to regional geopolitical changes, while others believe they are part of a planned strategy due to the area’s natural resources.

Recently, a commercial ship off Yemen’s coast issued a distress call after a missile attack.

This incident coincided with the first international conference on energy security through maritime safety kicking off in Cairo, organized by the Saif Bin Helal Center for Studies and Research in Energy Sciences.

The conference stressed that secure waterways are essential for energy exports and development.

“The region is unstable. Geostrategic, economic, and security challenges are mounting,” warned former Arab League Secretary-General and Egyptian Foreign Minister Amr Moussa at the opening of the conference.

“Disruptions in maritime routes threaten the stability, sovereignty, and wealth of nations. These are broad challenges, not just Red Sea issues—they’re reshaping global interests,” he added.

With this warning, he highlighted the ongoing turmoil in the Suez Canal, Bab el-Mandeb, and the Black Sea.

Moussa also warned about the risks of alternative routes being studied by various countries.

“These routes will serve specific national interests, not the security of international trade,” he cautioned.

On his part, Former Egyptian Petroleum Minister Osama Kamal stressed the vital role of the region’s waterways, especially with Gulf nations being major energy players worldwide.

He pointed out that without energy, there can be no development.

As the conference continued, British security firm Ambrey reported that a merchant vessel off the Yemeni coast took on water and tilted to one side after being targeted with three missiles.

The vessel issued a distress call stating it had sustained damage to the cargo hold and was taking on water approximately 54 nautical miles southwest of Yemen’s Hodeidah, Ambrey added.