Mediaeye News
Mumbai: Indian benchmark indices are expected to respond to major international developments this week, including the US Federal Reserve’s policy outcome, evolving US-Iran dynamics, and fluctuations in crude oil prices that could influence investor sentiment.
Benchmark indices ended the previous week on a positive note, breaking a two-week losing streak amid improving investor sentiment.
The Nifty gained 1.10 per cent to close at 23,622.90, while the Sensex rose 1.73 per cent to settle at 75,527.95.
The primary focus for global markets will be the US Federal Reserve’s Federal Open Market Committee (FOMC) meeting scheduled for June 16-17.
While the Fed is widely expected to keep interest rates unchanged, investors will closely scrutinise the central bank’s commentary on inflation, economic growth and the future rate trajectory. Any indication regarding the timing of potential rate cuts could influence foreign fund flows into emerging markets, including India.
Geopolitical developments in West Asia will also remain on investors’ radar. Market sentiment received a boost after US President Donald Trump said a peace agreement with Iran aimed at ending the conflict in the region would be signed on June 14. Investors will monitor the progress of the proposed deal and its implications for global trade and energy markets.
The reopening of the strategically important Strait of Hormuz, a critical route for global oil shipments, is expected to ease concerns over supply disruptions. Any further improvement in regional stability could support risk appetite across global equity markets.
Crude oil prices will be another key factor influencing domestic equities. Oil prices recently fell to their lowest levels since the initial phase of the Iran conflict amid expectations of increased crude shipments through the Strait of Hormuz and optimism surrounding a temporary peace arrangement. Sustained moderation in oil prices could provide relief to India’s inflation outlook and reduce pressure on the country’s import bill.
Meanwhile, investors will also assess the impact of the Reserve Bank of India’s latest measures to encourage foreign currency inflows. The central bank has introduced forex swap facilities for eligible external commercial borrowings (ECBs) and fresh FCNR(B) deposits, a move expected to strengthen liquidity conditions and support market sentiment.
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–IANS
