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Crude oil prices climbed more than 2% on Tuesday, bouncing back from losses posted in the previous session as concerns over supply resurfaced with the Strait of Hormuz largely shut and U.S. allies declining calls to deploy warships to escort tankers through the key shipping route.European nations have declined to deploy warships to the Strait of Hormuz, even as US President Donald Trump warned that NATO could face “a very bad future” if member countries do not step in to help reopen the crucial shipping route.Crude oil price on March 17Brent crude futures rose $2.48, or 2.5%, to $102.69 per barrel at 0058 GMT, while U.S. West Texas Intermediate (WTI) crude gained $2.42, or 2.6%, to $95.92 per barrel.The Strait of Hormuz, a key chokepoint that handles about 20% of global oil and liquefied natural gas trade, has been largely disrupted by the US-Israel war on Iran, which has now entered its third week. The disruption has heightened fears of supply shortages, rising energy costs and higher inflation.Several U.S. allies also pushed back against Donald Trump's request on Monday to send warships to escort shipping through the Strait of Hormuz. The move drew criticism from the U.S. president, who accused Western partners of ingratitude despite decades of American support.The effective closure of the strait has forced the United Arab Emirates, the third-largest producer in the Organization of the Petroleum Exporting Countries, to shut in production. As a result, its output has fallen by more than half, two sources told Reuters.Meanwhile, the head of the International Energy Agency said member countries could release more oil to help ease rising energy costs, in addition to the 400 million barrels they have already agreed to draw from strategic reserves.Where are prices headed?Experts say oil prices could climb further if geopolitical tensions persist. Global crude prices may rise to $120 per barrel in the near term and could even reach $150 per barrel if the war continues for more than a month and tensions in West Asia remain elevated, according to Kayanat Chainwala, Assistant Vice President at Kotak Securities.She added that crude prices below $110 per barrel can largely be managed within India’s current tax framework, giving the government some flexibility to absorb the impact.However, if prices move into the $110 to $125 per barrel range, fiscal flexibility would start to tighten and earnings divergence across companies in the oil and gas sector could widen, says Elara Securities.If crude prices climb above $125 per barrel, broader stress could emerge in the system. Earnings of oil marketing companies may weaken sharply, LPG subsidy burdens could rise significantly, and risks to LNG throughput may increase. In such a situation, the chances of policy intervention would also grow, it added.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

Mumbai: In Midnight's Children, Salman Rushdie's acclaimed novel, midnight symbolises the moment when darkness gives way to a new beginning. After nearly 18 painful months, investors are beginning to wonder whether equities may be approaching such a moment. Markets rarely reward philosophical reflection. Yet bear markets have a peculiar way of forcing it upon investors. A sea of red across portfolio screens tends to do that. But as they snap out of that mood, they are confronted with more practical questions: When will the sell-off end? Should I buy now? Why has the buy-the-dip strategy that worked so reliably since 2020 suddenly stopped working? Market wisdom holds that sell-offs, especially during wars, often present buying opportunities. The logic is that the market tends to overreact, pricing in some of the direst possible outcomes for the global economy. This time, as the conflict between US-Israel and Iran drags on, investors and analysts have not yet factored in the full extent of global economic damage, but for some aggressive crude price forecasts. Most do not see the war dragging on for long. While the conflict has lasted longer than what the market had expected, with Iran in no mood to give up, investors expect the Street to grow tired and indifferent to the war, much like the ongoing Russia-Ukraine conflict. So, does that mean this is the right time to buy Indian stocks? For investors accustomed to buying the dip, it is a natural question. After all, the Sensex and Nifty are down 7% this month alone, while the declines in several mid-cap and small-cap stocks are even steeper, extending the correction seen over the past 18 months. According to an ETIG study, 760 of the top 1,000 NSE-listed stocks by market capitalisation have fallen since September 30, 2024-the phase when the reversal in India's bull market began. Of the stocks that declined, nearly 70%, or 518, declined over 20% in the period. Further, 33%, or 250, dropped between 40% and 70%. This sell-off has certainly removed some of the froth seen in these stocks in 2024, but those appear to be only the excesses. Valuations, especially in the mid-cap and small-cap segments, are still far from cheap enough to justify deploying dry powder aggressively. Moving up the market-cap ladder, valuations of bluechips appear more palatable, according to senior money managers. Even there, however, the jury is still out on whether they qualify as screaming buys. Technically, Indian equities may be oversold in the near term, making a case for nibbling at some of the more beaten-down names in anticipation of a rebound. Should the conflict ease and crude prices retreat, a relief rally of 5-7% cannot be ruled out. Yet, the case for aggressive buying doesn't sit well with the market backdrop. For value seekers, the market is anything but cheap. Even after the correction, valuations mostly remain elevated by regional and historical standards. That's why many see the market less as a screaming buy and more as a sell-on-rise. Part of the reason is that the current geopolitical tensions may have overshadowed deeper concerns. Before the war dominated narratives, the market had been contending with the potential disruptions from artificial intelligence. For several sectors, particularly in technology and services, the conflict has merely pushed the debate around future earnings visibility to the sidelines rather than being resolved. With so many moving parts--from crude prices and geopolitics to global liquidity and technological disruption--few investors appear willing to go all in on equities. At the same time, exiting the market after a sharp drop may not be an option either. For now, the core investment principles remain unchanged: diversification across asset classes and a degree of defensiveness in portfolios. Fixed income does not appear to offer compelling opportunities either, while gold may rebound if the US dollar reverses its winning run. At this moment, investors are dealing with a kind of market midnight. But unlike Rushdie's midnight, the one on Dalal Street is marked by mixed signals and limited visibility. It still isn't a market that would reward bold calls, but it doesn't warrant selling out either.

Mumbai: Key Indian indices advanced over 1% in a late rally on Monday, snapping their three-day losing run, as the absence of fresh escalation in the West Asian conflict prompted traders to cut their bearish bets in an oversold market. NSE's Nifty rose 257.7 points, or 1.1%, to close at 23,408.8, while the BSE Sensex gained 938.93 points, or 1.3%, to end at 75,502.85. Both indices had declined as much as 0.8% earlier in the day. "Monday's bounce looked purely technical in nature, in the absence of any news flow," said Sham Chandak, head of institutional equities at Elios Financial Services. "The move was largely in Nifty and Bank Nifty, while broader market indices ended lower despite the recovery. This shows the move was largely on account of short covering in index derivatives." Elsewhere in Asia, Japan fell 0.1%, China declined 0.3%, and Taiwan dropped 0.2%, while Hong Kong rose 1.5% and South Korea gained 1.1%. Brent crude prices remained elevated above $100 but cooled to about $102 on Monday after rising above $106 earlier in the day, according to data from Investing.com.129621392 At home, FPIs net sold shares worth ₹9,365.5 crore, while domestic institutional investors bought shares worth ₹12,593 crore. The Nifty rebounded after dropping below the 23,000-mark briefly on Monday, said Dharmesh Shah, head of technical research at ICICI Securities "A gap-up opening or follow-up buying in the next session could signal the start of a technical pullback after the recent sharp fall. If weakness persists, the Nifty is likely to consolidate within the 22,700-24,000 band," he said. NSE's Volatility Index (VIX) - known as the market's fear gauge - fell 4.6% to 21.6, indicating some relief among traders. The broader market remained weak, with the Nifty Midcap 150 and Nifty Smallcap 250 indices falling 0.4% each. Out of the total 4,537 stocks traded on BSE, 1,470 advanced and 2,910 declined. "Market's biggest worry at this point is potential disruption to the Gulf supply chain and the possibility of shortages in essentials such as natural gas," Chandak said.

Wall Street ended sharply higher on Monday, fueled by gains in AI-related stocks, with Meta Platforms climbing after a report that it is preparing for sweeping layoffs, while oil prices retreated amid ongoing uncertainty about the Middle East conflict.The Dow Jones rose 387.94 points, or 0.83%, to 46,946.41, the S&P 500 gained 69.92 points, or 1.05%, to 6,702.18, and the Nasdaq advanced 268.82 points, or 1.22%, to 22,374.18. Meta jumped after Reuters reported that the social media platform plans to shrink its workforce by at least 20% to offset costly artificial-intelligence infrastructure bets and prepare for greater ‌efficiency brought about by ⁠AI-assisted workers. Nvidia ⁠climbed after CEO Jensen Huang announced new components at the chipmaker's annual developer conference. Taiwan's Foxconn, which makes AI servers using Nvidia chips, issued a strong quarterly revenue forecast on Monday. Tesla rose after CEO Elon Musk said the company's Terafab project to make AI chips will launch in seven days. Micron Technology jumped after the memory chipmaker announced plans for a second manufacturing facility in Taiwan. A modest drop in crude prices after the U.S. said it would be "fine" with some Iranian, Indian and Chinese ships moving through the Strait of Hormuz also offered some relief to the market. "You've got news that Iranian oil tankers are moving through, or are soon going to be ⁠moving through, ‌the Strait of Hormuz, which is a positive for global economic stability," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis. "But on balance, the path forward is filled with twists and turns. ... There's lack of ⁠visibility when the conflict is likely to end." Higher energy prices are likely to feature prominently in central bank meetings globally this week. The Fed is widely expected to leave interest rates unchanged at the end of its two-day meeting on Wednesday. Traders have pushed back their expectations for an interest rate cut of at least 25 basis points beyond October, according to LSEG-compiled data, compared with their previous expectation of a cut in July. "There are a couple of reasons to take any signals from this meeting with a pinch of salt. First, a swing in oil prices in either direction could quickly change the Fed's thinking, and second, markets might slightly discount messages from Chair (Jerome) Powell, given this ‌will be one of the last of his term," said James McCann, senior economist at Edward Jones in a note. Wall Street's fear gauge, the CBOE volatility index, dropped, while the rate-sensitive Russell 2000 index gained. Despite logging declines over the past three weeks, U.S. equities have fared better than global peers, buoyed by a rebound in beaten-down technology stocks and as the country is a net oil exporter. However, the S&P 500 remains down about 2% so far in 2026. February industrial production increased 0.2%, slightly better than expectations of a 0.1% rise. Travel stocks Delta Air Lines and Norwegian Cruise Line Holdings both gained, lifted by lower oil prices. Crypto stock Strategy Inc climbed as bitcoin rallied around 3%. Discount retailer Dollar Tree rose after signaling it could benefit from favorable tariffs in the near term.