‘Rising crude oil prices pose headwinds for Indian markets’
Headwinds with a potential to impact equity markets have emerged. One is the Iran-Israel skirmishes. The second is the concern that rate cut expected from Fed can be lower than three
The Middle East skirmishes have pushed up Brent crude to $91 and if oil continues to rise that can pose macro headwinds for India, says V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
Headwinds which have the potential to impact equity markets have emerged. One is geopolitical: the Iran-Israel skirmishes. The second is the concern that the rate cut expected from the Fed can be lower than three and that the first cut may come only in October. The US jobs data to be released on Friday will throw more light on this, he said.
It is possible that the exuberant Indian investors and DIIs flush with money may ignore the headwinds and buy the dips, imparting resilience to the market, he added. Amidst market weakness, banking stocks provide opportunities to buy. Data regarding deposit and loan growth from banking majors, particularly HDFC Bank are positive. Small finance banks data also indicate a healthy trend, he said. Deepak Jasani, Head of Retail Research, HDFC Securities, said crude oil extended gains as Israeli Prime Minister Benjamin Netanyahu said at a security cabinet meeting that his country will operate against Iran and its proxies and will hurt those who seek to harm it.
