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Indian equity benchmarks traded lower on Tuesday as higher oil prices and uncertainty over developments in the Middle East weighed on global market sentiment. The benchmarks, however, erased most of its losses.
The NSE Nifty 50 traded traded 0.42% lower at 23,284.25, down 98.35 points, facing resistance near the 23,300 level amid F&O expiry. The BSE Sensex declined 0.28%, or 208.36 points, to 74,058.98. Intraday, the Nifty fell as much as 0.7% to 23,229 and the Sensex declined as much as 0.6%, or 436 points, to 73,831.
Meanwhile, oil prices steadied after posting their biggest gain in about a month. Brent crude for August delivery traded near $95 a barrel after rising 4.2% in the previous session. West Texas Intermediate traded near $92 a barrel.
The Strait of Hormuz remains a critical route for global oil supplies, making developments in the region a key focus for energy markets.
US equity futures also pointed lower. S&P 500 futures fell 0.2%, Nasdaq 100 futures lost 0.3%, and futures tied to the Dow Jones Industrial Average dropped 122 points, or 0.2%.
Uncertainty Over Iran Talks
Iranian state media reported that the government had halted negotiations with the United States on ending the conflict in the Middle East in protest over Israel’s actions in Lebanon.
The report followed comments from Israeli Prime Minister Benjamin Netanyahu, who said he had ordered strikes on Dahiyeh, a southern suburb of Beirut regarded as a Hezbollah stronghold. Although the strikes had not begun, the threat prompted residents to leave the area.
US President Donald Trump later said he expected an agreement with Iran to extend the ceasefire and reopen the Strait of Hormuz “over the next week”. In a social media post, Trump said: “Talks are continuing, at a rapid pace, with the Islamic Republic of Iran. Thank you for your attention to this matter!”
Trump also said he had spoken with Netanyahu and representatives of Hezbollah. “I had a very productive call with Prime Minister Netanyahu, of Israel, and there will be no Troops going to Beirut, and any Troops that are on their way have already been turned back,” he wrote.
“Likewise, through highly placed Representatives, I had a very good call with Hezbollah, and they agreed that all shooting will stop – That Israel will not attack them, and they will not attack Israel.”
Israel Signals Further Action
The Lebanese presidency, citing the Lebanese embassy in the United States, said Hezbollah had agreed to a US proposal for a mutual cessation of attacks across Lebanese territory.
However, Netanyahu said the Israel Defense Forces would continue operations in southern Lebanon. “I spoke with President Trump this evening and told him if Hezbollah does not stop attacking our cities and citizens, Israel will attack terror targets in Beirut,” Netanyahu said at a press conference.
