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Indian equity benchmarks extended declines for the second consecutive trading session. The BSE Sensex fell as much as 542 points or 0.7% to 77,468.19 and the NSE Nifty 50 fell as much as 0.6% to 24,228.15.
Asian stock markets opened mixed on Monday as investors assessed Japan’s slower-than-expected economic growth alongside fresh developments in the Middle East. Japan’s Nikkei 225 gained 0.38%, while Australia’s ASX 200 fell 0.37%. South Korean markets were closed for a holiday.
Oil prices were broadly steady after a strong advance last week. Brent crude traded below $89 a barrel after gaining about 6% in the previous week, while West Texas Intermediate held near $82.
Fresh fighting in Lebanon and attacks on vessels in the Strait of Hormuz have complicated efforts to reach an agreement to end the US-Iran conflict. The two sides are approaching the formal end of their ceasefire, with negotiations showing no clear path towards reopening the key waterway.
Israel said it had killed 11 people, including a senior Hezbollah commander, in strikes on southern Lebanon. The fighting has added to uncertainty around the wider Middle East conflict and the prospects for a diplomatic settlement between Washington and Tehran.
The US is also preparing an “economic isolation” plan as negotiations remain stalled over the Strait of Hormuz.
Wall Street offered a positive lead despite the geopolitical uncertainty. The S&P 500 recorded a third consecutive weekly gain and reached another record high last week following a strong earnings season, although the index finished Friday lower amid signs of softer US consumer spending.
US equity futures were little changed in early Asian trading. Dow Jones Industrial Average futures rose 11 points, or 0.02%, while S&P 500 futures gained 0.1% and Nasdaq-100 futures advanced 0.2%.
Gold rose 0.4% to around $4,390 an ounce as investors continued to assess developments in the Middle East and their potential impact on global markets.
