Indian shares muted on Mideast jitters; traders eye RBI policy meeting

Indian shares were unchanged on Thursday as escalating US-Iran hostilities and mixed truce signals kept investors on tenterhooks ahead of a high-stakes Reserve Bank of India meeting, with Iran war-fuelled inflation high on policymakers’ minds.

The benchmark Nifty 50 rose 0.1% at 23,425.6, while the BSE Sensex gained 0.06% to 74,383.15, as of 10:18 a.m. IST.

Both the benchmarks lost about 0.6% at the open.

Fourteen of the 16 major sectors logged gains.

The broader small-caps and mid-caps rose 0.7% and 0.8%, respectively.

Iran struck Kuwait’s airport and the US launched retaliatory strikes near the Strait of Hormuz, overshadowing a US-brokered Israel-Lebanon ceasefire.

Consequently, Brent crude remained elevated near $97 a barrel.

Aakash Shah, technical analyst at Choice Equity Broking, said high crude prices are weighing on sentiment, leaving the Nifty rangebound but bearish, with immediate support at the 23,000–23,150 zone and resistance at 23,600-23,700 levels.

Both Nifty 50 and Sensex have declined in five of the last six sessions, dropping 2.6% and 2.8%, respectively.

Higher crude prices, alongside domestic fuel revisions and rupee weakness, have heightened inflationary concerns ahead of the RBI monetary policy decision on Friday.

Nearly 80% of the 56 economists in a Reuters poll expect the central bank to hold its key repo rate at 5.25%.

“More than the rate decision, investors will closely track the RBI commentary on inflation, liquidity, currency movements and global risks, as these factors will shape expectations around the future rate trajectory,” said Gaurav Garg, research analyst at Lemonn Markets Desk.

Among stocks, Rajesh Exports shed 5% after markets regulator SEBI barred the firm and its owner, alleging it inflated revenue by 15.15 trillion rupees ($158.30 billion) through unverified overseas entities.

Integrated petrochemical company Agarwal Industrial Corporation climbed 20% after securing a $49 million bitumen supply order from HPCL.