Global markets rally as Iran opens shipping channel

MUMBAI: The opening of the Strait of Hormuz, one of the most important shipping channels in the world for the flow of crude oil and natural gas, led to a global rally in stocks on Friday evening. This also overshadowed the muted trading witnessed during the early part of the day in all of Asia and some parts of Europe.In the evening, the US markets opened sharply higher with Dow Jones up over 2% while S& was up 1.3% and Nasdaq Composite was up 1.6%. And in late trades in Europe, Dax in Germany was up 2.6% while FTSE in the UK was up 0.6%.

S&P and Nasdaq Composite indices were at new all-time highs, while Dow Jones was about 1% away from hitting a new life-high mark.In India, in Gujarat’s GIFT City, the nifty index was up 1.6%, indicating a strong open for the Indian markets on Monday, provided there are no spoilers for the upbeat investor sentiment on Dalal Street over the weekend.Earlier in the day, after remaining in a narrow range for most of the session, sensex rallied in late trades to close 505 points up at 78,494 points on the back of weakness in crude prices because of the ceasefire declaration between Israel and Lebanon the previous evening. Reliance Industries and Hindustan Unilever contributed the most to the day’s gain in the index.Foreign funds were net buyers in stocks during Friday’s session with the net inflow at Rs 683 crore, BSE data showed. Domestic funds, on the other hand, were net sellers at Rs 4,721 crore.The day’s rally added nearly Rs 5 lakh crore to investors’ wealth with BSE’s market capitalisation now at Rs 465.5 lakh crore.Going ahead, market players would be looking at two things: The second round of talks between the US and Iran, and the trajectory of the crude oil prices, market players said.In precious metals, gold prices fell by Rs 1,600, or 1% while silver plunged Rs 5,700, or 2.2% amid subdued demand in the domestic market, according to the All India Sarafa Association. Globally, gold prices extended gains, supported by a weaker dollar and easing inflation concerns after reopening of the Strait of Hormuz. Spot gold was up 1.5% at $4,860/oz. Spot silver rose 4.6% to $81.99/oz.