The tension in the Iran vs Israel situation can have a massive impact on the global markets, including the Indian stock market.
The news of Iran’s over 300 drones and missiles launched on Israel last Saturday resulted in India’s Nifty 50 and Sensex falling over 1% each on Monday.
India is the third largest oil consumer while in OPEC, Iran ranks third in producing oil. The tension can result in oil supply scarcity impacting market sentiments.
The tensions can also result in an increase in commodity rates, impacting the target of controlling inflation and the need for rising interest rates. This can negatively impact the stock market.
Geopolitical tension can turn investors to be risk-averse and withdraw from the stock market, leading to negative market sentiments.
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