America hinting at a possible resolution with Iran has caused a stir in across global markets. After US President Donald Trump pressed pause for five days on strikes on Iranian energy infrastructure, oil prices began to recover sharply, Wall Street cheered and even the Nifty futures indicated a bullish open for Tuesday.
However, Arvind Sanger, managing partner at Geosphere Capital, still sees some weakness going ahead. According to Sanger, a five-day pause doesn't change much as the Strait of Hormuz is still closed. He expects the Indian market to correct 5% to 7% further it gets to a level where it starts to look like an interesting value and stability emerges.
"Valuation have not fallen to historical troughs... India is at a tough spot due to the war crisis," he said, adding that markets have not reached "table-pounding" levels yet.
Talking to NDTV Profit, Sanger highlighted that India is one of the most-hit nations due to the war and advised traders to stay on sidelines and have more liquidity. He expects domestic consumption and financials to suffer but also sees better recovery once the Strait of Hormuz has been opened and oil supplies normalise.
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Here's What Trump Said
US President Donald Trump rattled the world bright and early in the morning (EST) with his announcement of a five-day deferment of strikes on Iranian power plants and energy infrastructure, amid the ongoing war in the Middle East.
"I am please to report that the United States of America, and the country of Iran, have had, over the last two days, very good and productive conversations regarding a complete and total resolution of our hostilities in the Middle East," he said in a Truth Social post on Monday.
Stating that based on the tenor and tone of these in-depth, detailed, and constructive conversations, which will continue throughout the week, Trump further added, "I have instructed the department of war to postpone any and all military strikes against Iranian power plants and energy infrastructure for a five-day period."
The remark came as deadline neared after he threatened to 'obliterate' Tehran's power plants if the Strait of Hormuz is not opened within 48-hours. After the announcement crude oil, which has spiralled ever since the war began, showed rapid recovery with prices falling sharply.
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