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Indian shares drop the most in six weeks, $115 billion is wiped out and Mideast hopes fade
Indian stocks plunged on Tuesday. They lost about $115 billion in market value from firms listed on the National Stock Exchange. The outlook for Asia's third largest economy was worsened by fading hopes of a U.S. Iran deal. After Prime Minister Narendra Modi called for a reduction in fuel use and fertilisers, and a restriction on travel abroad and imports as global energy prices surged, the 1.4 billion-person country was prepared to take tough measures. The rupee fell to a new record low, Asia's worst performing currency so far in 2026, as crude remained near $107 a barrel, and outflows continued without abatement,?hammering stock prices across sectors. "The pressure on equity is now being amplified a macro-triple hit of?higher oil prices, rupee sliding to a record low, and continued aggressive outflows of foreign funds," said Hariprasad K., founder of Livelong Wealth. Hariprasad stated that there is a "broader sense of confidence shock" as investors interpret recent policy messaging as well as austerity-oriented comments as an indication of an upcoming tougher macroeconomic climate. India is the third largest oil importer in the world. It imports more than 90% of its crude oil and about half of its gas needs. The government has not yet raised the prices of fuels that are used by the general public. However, the oil minister stated on Tuesday that the government will at some point need to determine how long it can continue to sell fuels below the market price. India's Nifty fell by 1.83%, to 23,379.55, and the BSE Sensex dropped by 1.92%, to 74,559.24. This was their worst day for six weeks. Their losses in two sessions now totaled about 3.4%. The benchmark indexes, the Asian counterparts to the U.S.'s Dow Jones Industrial Average, fell by 1.3% when Donald Trump stated that a ceasefire between Iran and the United States was "on life support". Tehran rejected the U.S. proposal for an end to the conflict, and remained steadfast on a list that the U.S. president called "garbage". It takes a beating The shares of Indian IT companies fell by?3.7%, to a low of three years. This was due to concerns that AI would disrupt their traditional business model and also ahead of U.S. data on inflation which could raise concerns about rate hikes. The 16 major sectors declined, with small-caps dropping 3.2%, and mid-caps falling 2.5%. ONGC and Oil India, on the other hand, rose 4.8% and 7.7% respectively after CLSA claimed that the royalty reductions on crude and natural gas production benefits them.
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MORNING BID AMERICAS - Ceasefire on Life Support
What's important in U.S. and Global Markets Today By Mike Dolan Editor-at-Large of?Finance and Markets Stock markets find it difficult to ignore the renewed tensions between both sides, as the U.S. president Donald Trump said that the ceasefire in the Iran war has been on "life support" for a month. Oil prices have reacted badly to the possibility of a resumption in military action. Brent crude has risen back up to $107 a barrel - $10 above the previous week's low - while year-end futures are now back over $90/bbl. Below, I'll go into more detail. Check out my most recent column about why the world's financial markets are worried by Kevin Warsh and his plans for Fed. Listen to the Morning Bid podcast. Subscribe to the Morning Bid daily podcast and hear journalists discussing the latest news in finance and markets seven days a weeks. Ceasefire on Life Support While Wall Street reached new records yesterday, global equity markets have taken a significant step back today. Even South Korea's high-flying KOSPI index, which is dominated by tech, has taken a tumble, partly because of domestic fears about tax windfalls on AI-related profit. Energy prices have created a tense backdrop to the U.S. Consumer Price Report for April, which is due to be released later today. Forecasts indicate that the headline inflation rate will increase to 3.7%, a level not seen in three years. It's a worrying read as we head into today's and next week's big Treasury auctions for 10- and 30-year Treasury bonds. The latest twist in the UK political drama has further rattled the bond market. Keir starmer, the UK's Prime Minister, said today that he will remain in his position despite his party’s poor showing in UK local election last week. However, key members of his cabinet have apparently urged him set a timeline for his departure. Sterling also fell as a result of the uncertainty over what will happen next, and what a change in leadership might mean for UK fiscal and economic policies. The dollar was also generally stronger and the yen fell, even though U.S. Treasury Sec. Scott Bessent who is visiting Tokyo seemed to support the Bank of Japan’s efforts to normalize the monetary policy and stabilize the currency. Bessent stated that excessive volatility is not desirable. We have been in contact with the Ministry of Finance and will continue to do so. Kevin Warsh, the Federal Reserve Chair-apparent, cleared a procedural hurdle on Monday in the U.S. Senate, which will help him to move closer to confirmation and a smooth transition from outgoing chair Jerome Powell whose term ends this Friday. Chart of the Day U.S. consumer price index?likely accelerated higher for a second consecutive month in April. This would result in the highest annual inflation increase in over 2-1/2 years, and boost expectations that Federal Reserve interest rate will remain at current levels this year. The CPI is expected to have increased 3.7% in the 12 months up to April. This would be the largest year-on-year gain since September 2023, following a rise of?3.3% in March. The Iran-related oil price shock likely contributed to the CPI's increase last month, after an unprecedented surge in March. Watch today's events * U.S.?April CPI (8.30 am EDT) * U.S. 10-year note auction (1 p.m. ?EDT) * New York Fed’s John Williams, and Chicago Fed’s Austan Goolsbee?speak Want to receive Morning Bid every morning in your email? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed here are the author's. These opinions do not represent the views of News. News is committed to the Trust Principles and strives for integrity, independence and neutrality.
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Mapping the market: If a warning is confirmed, energy shares could be on their way down
The U.S. Energy shares had a good year, largely due to rising oil prices as a result of the Iran 'war. But the gains came with a great deal of volatility, and charts now flash a warning which could indicate a major drop. The S&P 500 Energy Index, which tracks the performance of energy stocks in S&P 500 is currently forming what technical analysts refer to as a head-and shoulders top. This pattern is often used to indicate a change from a bullish to a negative trend. This pattern has three peaks, with the highest peak in the middle. Two lower peaks are on either side. The "head" of the S&P 500 Energy Index, or SPNY is 976.91. The "shoulder" on the left is 883.48, and the "right" one 913.79. According to data provided by LSEG on Monday, the SPNY traded at 872.41 and would have to?fall below 820 in order to confirm that a head and shoulders formation has formed. Technical analysts would then?expect the SPNY to fall to 660 and erase all this year's gains. However, a move above the right shoulder high near 914 would undermine the bearish set-up and increase expectations of a rise beyond the high in March near 977. The SPNY was closely tied to oil prices earlier in the year. However, that relationship has been weakened recently. Energy shares are now responding less to changes in the price?of crude oil, and more to equity trends including sector rotation and specific company?movements. Exxon Mobil, and Chevron are the only two companies that account for almost half of the energy sector. The chart below shows: * A head and shoulders top is forming on the SPNY. This could indicate weakness in the future * The pattern includes three peaks with two smaller ones on either side of the highest peak * A fall of more than 820 would confirm that the head-and shoulders pattern has formed, and raise expectations for a decline to 660.
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UN: Global sand supply is not keeping up with demand, threatening ecosystems
The United Nations said in a report released on Tuesday that the growing global sand demand, due to rapid urbanisation, construction and other factors, exceeds sustainable supply. This puts ecosystems and livelihoods at risk. A report from the U.N. showed that about 50 billion tons of construction sand are used each year. The demand for this material is also expected to double in 2060 if current trends continue. This is faster than stock levels can be replenished. Environment Programme showed. The Environment Programme showed that sand is the second most-exploited natural resource after water. However, its use is not regulated and UNEP stated it was being consumed faster than geological processes can replace it. UNEP stated that unsustainable sand mining is damaging the environment in areas which are a critical habitat for fish, turtles and birds, as well as disrupting local communities. The report revealed that the depletion and growing demand for sand on land is driving a shift to marine dredging. Half of the dredging firms operate within Marine Protected Areas. UNEP's report stated that sand is being extracted from natural ecosystems, and is then transformed into concrete, glass, and asphalt, instead of being used to filter water and protect shorelines against erosion. "Sand is the first line of defense against rising sea levels, storm surges, and salinization of coastal aquifers, all of which are exacerbated by climate changes," said Pascal Peduzzi. Director of UNEP Global Resource Information Database Geneva. UNEP said that sand mining can cause habitat loss, pollution and harm to species such as sea turtles. It also has the potential to threaten local economies by accelerating beach erosion, reducing fish stock and damaging local economies. The report highlights the growing interest in mining magnetite, also known as "black sand", which contains valuable minerals. This is happening across many regions, including Southeast Asia and Latin America. UNEP has called for stronger governance including national sand inventory and better recognition of the sand resource as a strategic one. They have also warned that current oversight is fragmented, despite repeated concerns. (Reporting and editing by Hugh Lawson; Olivia Le Poidevin)
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IRGC officer: Iran now considers Strait of Hormuz a much larger zone
According to a'senior officer' in the Islamic Revolutionary Guard Corps Navy, Iran has expanded the definition of the Strait of Hormuz far beyond what it was before the Iran war. Fars, a news agency affiliated with the Iranian government, reported Tuesday that the strait was no longer viewed by the IRGC Navy as a small stretch of water around a few islands, but had been significantly enlarged and given a greater military significance. "In the past the Strait of Hormuz has been defined as a small area around islands like Hormuz or Hengam. But today, this view is changing," said Akbarzadeh. The Iranian authorities have not responded to an immediate request for comment. Around a fifth (or more) of the world’s?oil supply and liquefied gas passes through this strait. It is the main route to the Gulf for countries like Saudi Arabia, Iraq, and Qatar. Akbarzadeh described the strait as "a vast operating area" stretching from Jask, in the east, to Siri Island, in the west. This is the second time that Iran has announced an expansion since its war with the U.S. The IRGC Navy published a map on May 4 showing a zone of control extending a significant a'stretch of 'the UAE Gulf of Oman coast. The area covered by the road stretched from Iran's Mount Mobarak to the UAE's Fujairah and Iran's Qeshm Island, and then westwards to the UAE's Umm 'al Quwain. The announcement made on Tuesday appears to be a broadening of this area. Fars and Tasnim reported that another 'Iranian media agency', Fars and Tasnim on Tuesday, said the strait had increased in width from 20-30 miles to 200-300 miles. Tasnim stated that the expanded zone is a "complete crescent". (Reporting and editing by William Maclean, Jason Neely and Dubai newsroom)
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Kremlin claims that the Russian government has maintained economic stability, despite a downgrade in growth forecast
The Kremlin announced on Tuesday that the Russian government has taken all necessary steps to ensure economic stability, despite Moscow being forced to reduce its forecasted growth for 2026. The Russian Economy Ministry has revised its forecasts for the growth of GDP in 2026, reducing it from 2.8% to 1.4% and 2027 from 2.8% to 0.4%. Alexander Novak, Deputy prime minister, said on Tuesday that the growth rate was expected to be 2.4% by 2029. Dmitry Peskov, the Kremlin's spokesman, told reporters that Vladimir Putin is closely involved in economic issues and that Russia can "talk confidently about macroeconomic stability" despite volatility on global markets caused by a conflict in the Middle East. He said that a second meeting with government officials on the economy is expected this week. Peskov stated that "thanks to the actions being implemented by our Government, we can confidently talk about macroeconomic stability and promise plans to modestly but steadily increase economic growth rates every year." The Russian economy's $3 trillion, which has been hit by Western sanctions and the conflict in Ukraine as well as high interest rates, shrank by 0.3% during the first quarter. This is the first quarterly decline since early 2023, after the tax increases at the beginning of the year, along with deep discounts on Russian crude oil due to Western sanctions. Last year, Putin asked that the government ensure a resumption of growth in 2026. And last month, he criticized senior officials for the slowing economy and told them to find new ways to help the economy. Peskov, Putin's spokesman, said that he would not make any immediate changes in the government due to slow growth. He pointed out that the global economic environment was volatile. Reporting by Dmitry Antonov, Writing by Lucy Papachristou & Gleb Bryanski, Editing by Andrew Osborn
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Dollar, oil and gold rise as Middle East peace hopes fade
The dollar and oil prices rose on Tuesday, as the slim hope of a U.S.-Iran deal pushed gold down from its 'three-week-high'. This clouded U.S. rate expectations ahead of important inflation data. Spot gold dropped 0.8% by 0913 GMT to $4,698.22 an ounce, after reaching its highest level since April 21. U.S. Gold Futures for June Delivery lost 0.5% to $4,706.10. Donald Trump, the U.S. president, said that a ceasefire agreement with Iran is "on life support". This was after Tehran refused to accept a U.S. plan to end the conflict. It also refused to change its demands which the U.S. president called "garbage". Ole Hansen is the head of commodity strategy for Saxo Bank. He said that rising energy prices are once again driving up U.S. bonds yields in advance of today's CPI print (consumer price index). Oil prices rose as the Strait of Hormuz, a key shipping route, remained largely closed. The Federal Reserve may be able to get a clue from the April inflation figures, which are expected later today. Increased crude oil prices can fuel inflation and increase the likelihood of rising interest rates. Gold is often seen as a hedge to inflation, but high interest rates can weigh down on this non-yielding investment. The benchmark 10-year U.S. Treasury rate hit a new high while the dollar rose 0.4%. This made dollar-denominated commodities more expensive for holders other currencies. According to CME Group’s?FedWatch, traders have priced in a Fed rate cut this year. Markets now see a 36% likelihood of a hike before March 2027. The markets are also closely watching Trump's two day visit to China - scheduled for Wednesday - during which he will meet Chinese President Xi Jinping. Middle East is expected to be a major part of his agenda. Hansen said that "overall, gold remains rangebound. Support is established ahead of $4.500 while resistance is near the 50-day moving median, around $4.757." Silver spot fell by 2.4% to $84.05 an ounce. Platinum dropped 3.1% to $2,000 and palladium fell 1.6% to $1,484.23. (Reporting by Noel John in Bengaluru; Editing by Harikrishnan Nair)
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Sources: India and Russia are in advanced discussions on a critical minerals pact
Two sources with knowledge of the situation said that India and Russia have advanced 'talks' to sign a preliminary agreement on critical minerals, which would cover?exploration?,?processing?, and?technological collaboration. Sources who declined to be named as the discussions were not made public said that the deal would focus on rare earths and lithium, while the two governments will also facilitate corporate investment. They added that the agreement could be signed within two months. One of the sources stated that "we have shared with our Russian counterparts a draft agreement proposal." The Ministry of Mines in Russia, which leads the discussions, did not reply to an email requesting comment. The Ministry of Industry and Trade of Russia and the Office of First Deputy Prime Minister Denis Manturov did not reply to requests for comments. India wants to reduce its dependency on China for minerals, as China dominates the global market and has advanced mining technology. It also wants to secure new supplies from overseas to help it with its energy transition and infrastructure. New Delhi has signed agreements on critical minerals with Argentina, Australia, and Japan and is currently in discussions with Peru and Chile about broader bilateral agreements, which include critical minerals. India, however, has not been able to secure critical minerals overseas. It has signed a single lithium mining and exploration project agreement covering five blocks in Argentina by 2024. One of the sources stated that India might 'also revisit the Russian state nuclear corporation Rosatom’s lithium exploration project for Mali, if the political climate in the West African country stabilized. In early 2014, it was reported that India had withdrawn from the Mali lithium project due to security concerns. New Delhi signed a number of agreements with countries this year, including Germany, Brazil and Canada. The aim was to "increase access to technology and partnerships". The government has identified that more than 20 minerals including lithium will be critical to its energy transition, industrial growth and infrastructure needs in 2023. (Reporting and editing by Mayank Bhadwaj, Kate Mayberry, Anastasia Lyrchikova; Additional reporting by Neha Aroos in Moscow)
South Korea's SK Group thinks about possession sales, mergers as part of significant overhaul
South Korea's SK Group plans to hold a twoday method conference beginning Friday to go over enhancing its organization to focus on secret areas consisting of expert system, chips and batteries.
The group, best understood for its chip company SK Hynix , has become bloated over the previous years and its electrical car battery unit has actually lost billions of dollars.
Here is what's known about the predicted restructuring:
WHY AND HOW MAY SK SHOT TO RESTRUCTURE ITS SERVICES?
South Korea's second-largest conglomerate included 219 business as of May, the most among the country's 88 business groups, according to the Korea Fair Trade Commission. By contrast, Samsung Group, the greatest corporation by properties, has 63 firms and Hyundai Motor Group has 70.
The SK conglomerate has been considering a revamp because 4 senior executives stepped down late last year. Its main cash maker, SK Hynix, also suffered heavy losses in 2015, stretching the corporation's financial resources.
The conference, which will include executives from the parent company and affiliate firms, will look at alternatives from mergers to divestments, according to a source with direct understanding of the matter who was not authorised to speak with media and decreased to be recognized.
A SK Group spokesperson explained the conglomerate's evaluation of its organizations as a routine management activity to help it better react to an altering business environment, consisting of geopolitical problems.
BATTERY BLUES
SK Development, which owns the country's biggest oil refiner and battery maker SK On, is anticipated to pursue a. merger with profitable gas affiliate SK E&S to assist prop up SK. On, local media outlets have reported.
SK Innovation has stated it is considering different strategic. procedures including mergers to strengthen its competitiveness,. but nothing has been decided.
SK On has never ever made a profit because it was divided off from SK. Development in late 2021. Its cumulative operating losses quantity. to about 2.3 trillion won ($ 1.7 billion) while its. debt-to-equity ratio was 188% since end-March.
But the conglomerate sees batteries as a long-term growth. area and is attempting to cut back investments in other units so it. can much better support SK On, experts say.
OTHER SERVICES LIKELY TO BE AFFECTED
The corporation might also combine contractor SK EcoPlant and SK. Materials' commercial gas system, the Korea Economic Daily. reported on Sunday, citing unidentified industry sources.
SK EcoPlant and SK Materials said they were not aware of. such conversations.
SK Networks, which offers smart devices and manages. hotels, said last week it would sell its cars and truck rental to. private equity firm Affinity Equity Partners for 820 billion won. ($ 590 million).
The group is likewise in talks to offer its 9% stake in Vietnam's. Masan Group back to the retail-to-telecoms conglomerate, an SK. spokesperson said.
(source: Reuters)