MUMBAI: Rising crude oil prices with the Indian crude basket at a 14-year high, fresh weakness of the rupee after an eight-session gain and sliding Asian markets weighed on investor sentiment on Dalal Street on Thursday.As a result, sensex showed a weak trend from the start of the session and closed 460 points or 0.6% lower at 73,249 points. On NSE, Nifty lost 124 points or 0.5% to close at 22,688 points.On Thursday, the average price for the Indian crude basket for Oct hit a high of $120 per barrel, up from the recent high of $114.5 in April. This is the highest level since it hit $123.6 in March 2012, data from Petroleum Planning & Analysis Cell of ministry of petroleum & natural gas showed. The Indian crude basket is a derived basket of two types of crude oil, Brent and Oman & Dubai, that are imported by Indian refiners.
This came on the back of talks of escalation of the war between US and Iran in the Persian Gulf region.
This jump in the Indian basket came as Brent crude prices shot up to over the $112 per-barrel mark, the highest level seen since May this year. This came on the back of talks of escalation of the war between US and Iran in the Persian Gulf region.Shooting oil prices also weakened the rupee that, after an eight-session rally, reversed trend to hover close to the 95/$ level, having fallen 36 paise. Weakness across major Asian markets also made Indian investors nervous, market players said.According to Ankur Punj, MD, Equirus Wealth, India market’s downward spiral continued due to external factors as a fresh escalation in the West Asia conflict pushed oil prices up. “Weak Asian and European market cues and a steep fall in the rupee against the dollar further (affected investor) sentiment,” Punj wrote in a note. “While (corporate) earnings have been a mixed bag so far, concerns over an uptick in inflation due to higher crude oil prices and persistent (foreign fund) selling in local shares could further drive investors to safe haven dollar assets.”Among the major Asian market indices, Kospi in Korea closed 3.5% down, Hang Seng in Hong Kong closed 3% down, Nikkei in Japan was down 2.7% at the close while Shanghai Composite in China closed 1.5% lower. European markets too were mostly in the red in late trades with CAC 40 in France down 1.4%, DAX in Germany down 1.1% and FTSE 100 down 0.3%.In the domestic market, foreign investors again led the selling, after recording a net buying figure on Wednesday. At the close of Thursday’s session, foreign portfolio investors (FPIs) were net sellers at Rs 3,459 crore while domestic funds were net buyers at Rs 2,891 crore, provisional data on BSE showed. The day’s session left investors poorer by about Rs 3.3 lakh crore.
