The 21-hour talks between America and Iran in Pakistan have ended without any agreement. US Vice President JD Vance clarified that Washington had put its ‘last and best proposal’ on the table, but it is clear from Iran’s stance that it still feels the need for further discussion. This deadlock has also raised serious questions on the sustainability of the existing two-week ceasefire. Experts believe that this tension between the two countries may extend further, whose direct impact will be seen on the global commodity and financial markets.
Signs of sharp rise in crude oil prices
When the markets open on Monday, April 13, a sharp rise in crude oil prices may be seen. According to Peter McGuire, CEO of XM Australia, there could be a direct jump of a few dollars in the price of crude oil in early trading and the market will witness huge fluctuations on the very first day. He has expressed apprehension that within the next 24 to 48 hours, oil prices may reach close to the level of $ 100 per barrel. McGuire says that different statements coming from America and Iran have created a situation of confusion in the market, due to which global uncertainty is increasing further.
Will the stock market fall again?
While there is a possibility of a sharp rise in crude oil, the trend of the stock market may remain somewhat balanced. Sanjay Parekh of Soham Asset Managers’ analysis is that there will definitely be ups and downs in the market, but at present the possibility of any big or heavy fall is limited. Market experts believe that at present there is more pressure on America to reach a compromise. In such a situation, the market will not weaken completely and can keep its stance neutral.
Talking about investment strategy, Parekh has advised that if there is a correction (fall) of 3 to 5 percent in the market, then it should be seen as a good investment opportunity. However, considering the current uncertainty, purchasing gradually in installments instead of lump sum investment would be a safer option.
How will be the condition of rupees?
For India, the cost of oil is directly related to the economy. According to experts, rising crude oil prices may have a negative impact on the Indian rupee. India will have to spend more dollars to import expensive oil, which will increase the demand for dollars and put pressure on the rupee exchange rate. If global uncertainty increases, the rupee may depreciate further. However, if the flow of foreign investment continues, this decline may also be limited.
Sectorally, the increase in oil prices will put pressure on the margins of oil marketing companies (OMCs), aviation and paint sector companies. On the other hand, oil producing (upstream) and energy sector companies can directly benefit from this boom.
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