Indian shares muted as US strikes dent Mideast peace hopes, spur caution

India’s equity benchmarks were muted on Tuesday, as U.S. strikes dented hopes of an ​imminent peace deal with Iran, a day after the indexes jumped ‌to two-week highs as investors bet on the end to the months-long war.

U.S. Secretary of State Marco Rubio said on Tuesday negotiating a deal with Iran could “take a few ​days” after the U.S. struck boats allegedly attempting to lay mines and ​missile-launch sites.

India’s benchmark Nifty 50 added 0.11% to 24,057.95 and ⁠the BSE Sensex added 0.06% to 76,535.45, as of 10:15 a.m. IST. ​The indexes swung between slight losses and gains in early trade.

Eleven of the ​16 major sectors advanced, but the gains were marginal. The broader small-caps and mid-caps rose 0.9% and 0.3%, respectively.

“Investor optimism over a U.S.-Iran peace deal has been tempered by fresh ​U.S. strikes in the Middle East,” said Devarsh Vakil, head of prime ​research at HDFC Securities.

While Washington has framed the strikes as a move to protect U.S. ‌troops ⁠from Iranian threats, the episode has raised concerns that a final agreement may take longer to materialise, Vakil said.

India has been reeling under the effect of rising crude prices and supply disruptions after the closure of the Strait ​of Hormuz due ​to the U.S.-Israel ⁠war on Iran.

The world’s third-largest oil importer and consumer raised prices of petrol and diesel again on Monday, the ​fourth increase in May, in a bid to recoup some ​losses.

Brent ⁠futures rose 2.1% to about $98.2 per barrel.

Traders braced for choppy trading as NSE and BSE derivatives contracts expire on Tuesday and Wednesday, respectively.

Among stocks, state-owned railway infrastructure ⁠firm ​Rail Vikas Nigam lost 2.3% after posting a ​decline in the quarterly profit. Logistics firm Container Corporation of India fell 5% on a fourth-quarter ​profit drop.