Global Equities Surge as U.S.-Iran Ceasefire Restores Oil Flows and Boosts Risk Appetite
Indian equities are set for a focused day, tracking marginal movements through the GIFT Nifty, which traded around 24,008 in early deals. This muted start comes after Indian markets extended their winning streak for a fourth consecutive session on June 17th. The Sensex closed at 77,155.62 (up 0.45%), and the Nifty 50 settled at 24,085.70 (up 0.40%) following broad-based buying across sectors.Overnight Global Market Momentum Builds
Global markets saw significant volatility driven by geopolitical developments and central bank commentary. Asian equities rallied to a record high, buoyed by rising risk appetite over the potential reopening of the Strait of Hormuz. This optimism was mirrored in U.S. stock indexes, which rallied on Thursday.The Nasdaq Composite surged 1.91%, hitting 26,517.93. The S&P 500 gained 1.08% to 7,500.58, while the Dow Jones Industrial Average rose 0.14% to 51,564.70. These gains occurred despite investors still pricing in interest rate hikes this year from the Federal Reserve.
Crude Oil and Gold React to Geopolitical Shifts
Crude oil is trending toward a substantial weekly drop after the U.S.-Iran interim peace deal was signed. The agreement has prompted shipping through the Strait of Hormuz to return towards normal, thereby easing what was described as the global crude market's biggest-ever supply shock.Meanwhile, gold futures are on track for a third weekly loss. This trend is largely attributed to the hawkish stance of the Federal Reserve and ongoing bets regarding potential rate hikes, outweighing the impact of the US-Iran peace agreement. The U.S. dollar index remained little changed against major currencies in early trade.
Key Asian Currencies and Commodity Trends
Asian currencies displayed mixed performance against the U.S. dollar. The Japanese Yen proved to be the strongest performer, appreciating 0.174%, followed by the South Korean Won gaining 0.125%. Stable market conditions were indicated by the Singapore Dollar moving up 0.008%.On the weaker side of the trading session, the Philippine Peso recorded the steepest decline, falling 0.323%. The Indonesian Rupiah lost 0.180%, while the Chinese Renminbi weakened 0.106%. Both the Thai Baht and Malaysian Ringgit remained mostly flat, with marginal declines of 0.009% and 0.007%, respectively.
Institutional Flows Show Divergence in Indian Equities
Fund Flow data for June 18th showed a divergence between foreign and domestic investment flows. Foreign Institutional Investors (FIIs) were recorded as net sellers, offloading equities valued at more than ₹1,000 crore.In sharp contrast, Domestic Institutional Investors (DIIs) provided strong support to the market during the session, purchasing equities worth ₹3,516 crore. This internal buying activity stands against the FII outflows, providing a clear picture of supportive domestic capital flows.
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