Here are 5 factors that could determine market action on March 9:
America, Israel and Iran war
The conflict between Iran and the US-Israeli alliance continued to escalate, with leaders from all sides warning that the situation could worsen. US Defense Secretary Pete Hegseth said the conflict had “only just begun”, while US President Donald Trump said there was “no time limit” on how long the war could continue.
US officials have also indicated that the country has sufficient military equipment to sustain military operations in the region for a long time. Conflict in the oil-rich Middle East intensified over the weekend when the US and Israel launched attacks on Iran that killed its supreme leader, Ayatollah Ali Khamenei. Iran responded with retaliatory attacks in several parts of the region. The absence of any clear diplomatic efforts to end the war has unsettled global investors.
Crude moves above $90
A trade strike between Israel, the US and Iran for the eighth consecutive day has seen a sharp jump in oil prices. Just last week, before the conflict erupted, crude was around $62 a barrel. By Friday, however, the US Crude futures jumped as much as 12% amid fears of supply disruptions, before paring some gains. Brent crude rose $7.28, or 8.52%, to settle at $92.69 a barrel, while West Texas Intermediate (WTI) settled up $9.89, or 12.21%, at $90.90 a barrel.
Markets are jittery as the escalating conflict in the Middle East disrupts shipping and energy exports through the crucial Strait of Hormuz. This narrow chokepoint between Iran and Oman normally carries a fifth of the world’s supply of crude oil and liquefied natural gas. In practical terms, about 20% of global oil demand passes through the strait every day. With the waterway effectively blocked for the past seven days, around 140 million barrels of oil, about 1.4 days of global demand, have been prevented from reaching international markets.
The exodus of FIIs continues
According to NSE data, foreign investors were net sellers of Indian equities during the previous session, buying Rs. 6,030 crore worth of shares were sold. Domestic investors on Friday raised Rs. 6,971 crore were net buyers buying Indian equities. FIIs have so far this month invested around Rs. 30,000 crore worth of Indian equities sold, as war in the Middle East spooked investors.
Additionally, Morgan Stanley has reduced its exposure to Indian markets, while taking a more cautious stance on Asian equities amid concerns that the Iran war could disrupt Iran’s war supply chain if it fails to recover oil flowing through the Strait of Hormuz. “We remain defensive,” Morgan Stanley strategists said, adding that “Asia is heavily dependent on Middle Eastern supplies of crude oil, refined products and LNG, and we believe the market is very complacent about supply chain risks.”
Disappointing US jobs data
The US labor market showed signs of weakening in February, with the Bureau of Labor Statistics reporting that nonfarm payrolls fell by 92,000. This marked a sharp reversal from a downwardly revised gain of 126,000 jobs in January and was worse than the 50,000 economists polled by Dow Jones had expected. The unemployment rate also rose to 4.4% from 4.3% in the previous month.
“The headline number was very disappointing and will feed concerns that the labor market — despite the strong January jobs report — is softening,” Tim Holland, Orion’s chief investment officer, told CNBC.
Poor technical setup
Indian equity markets are likely to get off to a cautious start next week as global risk sentiment has deteriorated sharply. The current trend in the GIFT Nifty, which closed around the 24,300 level, indicates bearishness compared to the previous Nifty close near 24,450, said Hariprasad K of Livelong Wealth.
This combination of macroeconomic uncertainty and geopolitical risk is likely to influence market sentiment in the near term. Indian markets may see continued volatility unless there are positive developments in the conflict in the Middle East, bringing down crude oil prices.
From a technical perspective, Pravesh Gaur of Swastik Investsmart said Nifty is taking support near 24300 but is highly volatile. On the upside, the 24,900-25,000 range is expected to act as an immediate supply zone, where selling pressure could emerge if the index attempts a recovery. On the downside, 24,300 remains the first key support, and if the index slips below this level, 23,800 will be the next important support area that traders will closely monitor.
(Disclaimer: Recommendations, suggestions, opinions and views given by experts are their own. These do not represent the views of Economic Times)
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