Indian equities may face another volatile week as the closure of the Strait of Hormuz and fresh US strikes on Iran raise the risk of higher crude oil prices, foreign outflows and pressure on the rupee. The immediate concern for Dalal Street is oil as India imports a large part of its crude requirement, and any disruption in the Strait of Hormuz can quickly feed into inflation, current account worries and corporate margins.
Reuters reported that the US launched fresh strikes after accusing Iran’s IRGC of attacking the Cyprus-flagged cargo ship M/V GFS Galaxy in the Strait of Hormuz. Iran has said the strait will remain closed until further notice, while the US has demanded that all shipping lanes be reopened.
