Sensex sinks 642 points as crude oil woes persist
Mumbai, Sep 17: Market benchmark BSE Sensex on Tuesday plummeted 642 points as investors weighed India's fiscal worries due to soaring crude prices in the wake of growing geopolitical tensions in the Middle East.
After nose diving 704 points, the 30-share index ended 642.22 points, or 1.73 per cent, lower at 36,481.09. The broader NSE Nifty too settled 185.90 points, or 1.69 per cent, down at 10,817.60.
On the Sensex chart, losses were mainly driven by Hero MotoCorp, Tata Motors, Axis Bank, Tata Steel, Maruti and SBI falling as much as 6.19 per cent.
Of the 30 scrips of the BSE gauge, HUL, Asian Paints and Infosys were the three gainers.
Investors were spooked by geopolitical uncertainties over the Saudi oil turmoil amid reports that higher oil prices were likely to severely hit economic conditions in India, which imports more than 70 per cent of its oil needs, experts said.
The attack on the world's largest oil processing facility in Saudi Arabia has led to a record surge in global crude prices.
After soaring as much as 20 per cent to USD 71.95 per barrel on Monday, Brent crude futures corrected slightly to trade at USD 67.97 per barrel on Tuesday.
Higher import cost of oil could sharply worsen current account position, compress profit margins and raise inflation, a Nomura report said.
Tracking the movement in oil prices, the rupee further depreciated by 37 paise (intra-day) to trade at 71.97 per US dollar.
Market participants were also on edge awaiting cues from the upcoming trade talks between China and the US as well as a much-anticipated policy meeting of the Federal Reserve, scheduled to begin later in the day.
Elsewhere in Asia, Shanghai Composite Index and Hang Seng ended significantly lower, while Nikkei and Kospi settled in the green.
Stock exchanges in Europe were trading on a mixed note in their respective early sessions.
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Iran attacks oil tanker near Dubai; Trump warns of strikes on energy sites if Hormuz remains shut
Tel Aviv/Washington: Iran attacked and set ablaze a fully loaded crude oil tanker off Dubai on Monday after US President Donald Trump warned that Washington would target Iran’s energy infrastructure if the Strait of Hormuz is not reopened.
According to a Reuters report, the Kuwait-flagged tanker Al-Salmi is owned by Kuwait Petroleum Corporation and was capable of carrying around 2 million barrels of crude. . It was struck in what authorities later described as a drone attack. The company said the incident occurred early Tuesday, causing a fire and hull damage. No injuries were reported and the fire was brought under control, Dubai authorities said .
Oil prices rose briefly following the attack and added to volatility in global energy markets. In the United States, retail gasoline prices crossed $4 per gallon for the first time in more than three years, according to data from GasBuddy, as crude prices moved above $101 per barrel.
Israel said it carried out missile strikes on military infrastructure in Tehran and on sites linked to Iran-backed Hezbollah in Beirut. Explosions were reported in parts of Tehran, with Iran’s Tasnim news agency saying power outages occurred in the eastern Pirouzi district following the blasts.
The Israel Defense Forces said four soldiers were killed in southern Lebanon. In recent days, three peacekeepers serving with the United Nations Interim Force in Lebanon were also killed in separate incidents in the same area.
Iran’s military spokesperson said Tehran’s latest wave of missile and drone strikes targeted US military positions at five bases in the region and sites in Israel. Thousands of troops from the US Army’s 82nd Airborne Division have begun arriving in the Middle East, according to US officials, expanding Washington’s military options even as diplomatic efforts continue.
White House Press Secretary Karoline Leavitt told Reuters Trump wants an agreement with Iranian leaders before a revised April 6 deadline for reopening the Strait of Hormuz, adding that talks were progressing, while public statements from Tehran differed from private communications.
Iran’s Foreign Ministry spokesperson Esmaeil Baghaei said proposals received through intermediaries were “unrealistic” and maintained that Iran was focused on defending itself.
In a social media post, Trump said that if a deal is not reached soon and the strait is not reopened, the US would strike Iran’s electric generating plants, oil wells and Kharg Island. However, a report in The Wall Street Journal said Trump had told aides he may be willing to end the military campaign even if the strait remains largely closed and address reopening it later. The White House referred to earlier remarks by Secretary of State Marco Rubio that the strait would be opened “one way or another.”
The administration has also requested an additional $200 billion in funding for the conflict, a proposal that faces opposition in the US Congress.
