Impact of Israel- Hamas War on Indian Market
Over 1,000 people were killed in a surprise multifront onslaught by the Palestinian militant group Hamas on Israeli territory through land, air, and water.
Due to this development, there have been increased geopolitical tensions, rising crude oil prices, and turbulence in the world stock markets. Concerns regarding the potential effects of the current uptick in hostilities between Israel and Hamas, notably on the Indian stock market, have been expressed.
Indian markets may face some effects of war such as:
- Global Market Sentiment:
Global financial markets may become more uncertain and risk averse as a result of geopolitical conflicts. When investors are worried about global disputes, they can withdraw their money from emerging economies like India and relocate it to saf investments, which could cause Indian stock values to fall.
- ๐ฆ๐๐ฟ๐ด๐ฒ ๐ถ๐ป ๐ผ๐ถ๐น ๐ฝ๐ฟ๐ถ๐ฐ๐ฒ๐:
The Israel-Hamas dispute is situated in the Middle East, which is a significant oil-producing region. Any escalation of hostilities in this region may result in an increase in world oil prices. India is a net importer of oil (๐ถ๐บ๐ฝ๐ผ๐ฟ๐๐ ๐ด๐ฑ% ๐ผ๐ณ ๐ถ๐๐ ๐ฐ๐ฟ๐๐ฑ๐ฒ ๐ฟ๐ฒ๐พ๐๐ถ๐ฟ๐ฒ๐บ๐ฒ๐ป๐), therefore higher oil prices could have a detrimental effect on its economy and stock market by increasing inflation and trade deficits.
- Currency Exchange Rates:
Currency exchange rates can also be impacted by geopolitical concerns. The earnings of Indian businesses with global operations and the stock market may be impacted by a depreciation of the Indian Rupee in relation to major world currencies.
- ๐๐ฒ๐ฐ๐น๐ถ๐ป๐ฒ ๐ถ๐ป ๐ด๐น๐ผ๐ฏ๐ฎ๐น ๐ฒ๐ฐ๐ผ๐ป๐ผ๐บ๐ถ๐ฐ ๐ด๐ฟ๐ผ๐๐๐ต:
The current Israel-Hamas conflict may potentially slow global economic expansion. As a result, there would be less demand and for Indian goods and services, which would cause Indian equities to drop in value.
- Investor Sentiment:
Geopolitical developments can have a significant impact on investor mood. As investors become more risk averse, bad news or uncertainty about international conflicts may cause a sell-off in Indian markets.
