September 10, 2025

THE CLIFF NEWS

National Daily Bilingual Newspaper

Category: Stock Market

Rupee, Bonds Under Pressure After US Strike on Iran; Oil Price Surge, Geopolitical Tensions Worry Markets

The Indian rupee and government bonds are expected to come under renewed pressure this week following a dramatic US military strike on Iran’s nuclear sites, an escalation that threatens to further destabilize the Middle East and push global oil prices higher. The rupee closed last Friday at 86.5850 per US dollar, posting a weekly decline of 0.6%, as markets grew jittery ahead of potential retaliation from Iran. The US strike, reportedly in coordination with Israel, has prompted strong condemnation from Tehran, which called it a “grave violation of international law” and vowed to defend itself. In response, President Donald Trump issued a stern warning that any Iranian retaliation would be met with further attacks, unless Iran pursued peace. Oil Prices Spike Amid Escalating Conflict Crude prices, already elevated due to earlier regional tensions, are expected to surge by another $3–$5 per barrel, analysts say. Brent crude futures closed at $77 per barrel on Friday, up nearly 4% on the week, adding to concerns for energy-import-dependent economies like India. Higher crude oil prices tend to exert downward pressure on the Indian rupee and inflate the country’s import bill, widening the current account deficit and pushing up inflation. “A flight to safety is likely to reinforce the dollar’s strength against the Indian rupee and other major currencies,” said Dilip Parmar, foreign exchange research analyst at HDFC Securities. He predicts the rupee could weaken toward 87.50 in the near term. Traders say that the Reserve Bank of India (RBI) may step in to curb any excessive volatility, especially if the rupee breaches the 87.50–87.60 range, considered its next immediate support zone. Bonds and Inflation Outlook India’s 10-year benchmark bond yield (6.33% 2035) ended Friday at 6.3087%, and is expected to move between 6.30% and 6.40% this week. A $10 per barrel increase in crude could widen India’s current account deficit by 0.3% of GDP, said CR Forex, potentially stoking inflation and eroding real yields. Earlier in June, the RBI cut its repo rate by 50 basis points, a deeper-than-expected move, and lowered its inflation forecast to 3.7% for the current fiscal year. However, the central bank also shifted its stance to ‘neutral’ from ‘accommodative’, signaling a potential pause in its easing cycle. “The RBI may wait longer to assess the impact before initiating another rate cut,” said Alaa Bushehri, head of emerging market debt at BNP Paribas Asset Management. “We expect the RBI to stay on hold in the coming months amid international uncertainties.” Other Market Triggers This Week Overall, with geopolitical tensions rising and oil markets reacting swiftly, both the rupee and bond markets will likely remain volatile, closely tracking developments on the international front.

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Editor05 mins

Shell Warns of Global Trade Disruption if Strait of Hormuz Blocked Amid Israel-Iran Conflict

June 20: Global energy giant Shell Plc has issued a stark warning that any disruption in the Strait of Hormuz, amid rising tensions between Israel and Iran, could have devastating effects on global trade, particularly oil and gas supplies. Speaking at the Japan Energy Summit & Exhibition in Tokyo, Shell CEO Wael Sawan stated that the company has contingency plans in place should the situation deteriorate further. “If that artery is blocked, for whatever reason, it has a huge impact on global trade,” Sawan said. “We have plans in the eventuality that things deteriorate.” Energy Flows Under Watch While crude prices have risen in recent days due to the hostilities, actual energy flows remain uninterrupted. However, global energy traders are on high alert, anticipating that the escalation could soon impact maritime logistics. The Strait of Hormuz, a 33-kilometre-wide chokepoint at its narrowest, is once again at the centre of geopolitical and energy security concerns. Roughly one-quarter of the world’s oil supply and a substantial portion of liquefied natural gas (LNG) pass through this narrow waterway. It links the Persian Gulf to the Indian Ocean and serves as the main export route for oil and gas from key producers including Saudi Arabia, Iraq, UAE, Kuwait, Qatar, and Iran. Iran’s Threats and Jamming Activity Iranian leaders have repeatedly threatened to block the strait in retaliation against perceived provocations, raising concerns among energy-dependent nations like India and Japan. Recent reports have also highlighted signal jamming incidents affecting ship navigation through the region. Sawan confirmed the issue, stating: “What is particularly challenging right now is some of the jamming that’s happening.”He emphasized that Shell is being extremely cautious with its shipping operations in the Middle East. US May Join Conflict Sources close to the matter have revealed that senior US officials are considering a direct military strike on Iran, further raising fears of a wider regional war. While no final decision has been made, preparations and intelligence assessments are reportedly underway, with the situation said to be “fluid.” Global Implications Loom As the conflict threatens to spill over into international waters, the global economy stands at risk, particularly through potential disruptions to oil prices, supply chains, and shipping routes. A prolonged or intensified blockade of the Strait of Hormuz could send energy prices soaring, trigger global inflation, and cripple trade routes critical to both developed and developing nations. In the meantime, Shell and other global energy companies continue to monitor the region closely while activating risk mitigation strategies, underscoring the fragile state of energy security in today’s geopolitical climate.

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Editor04 mins

Markets Flat Amid Weak Sentiment; IT & PSU Banks Drag, Auto Shines Slightly

Markets struggled to find clear direction on June 19, with benchmark indices Sensex and Nifty trading marginally lower by midday. The slide was led by sharp losses in IT and PSU banking stocks, weighing down overall investor sentiment. Auto stocks were the lone sectoral gainers, providing modest support in an otherwise cautious market environment. As of 12:15 PM, the Sensex was down 15.61 points or 0.02% at 81,429.05, while the Nifty slipped 0.30 points, holding nearly flat at 24,811.75. The broader market mood remained subdued, with 919 shares advancing, 2,400 declining, and 117 remaining unchanged, indicating widespread weakness. Laggards on the Nifty included Asian Paints, ONGC, Bajaj Finserv, Hindustan Unilever, and Sun Pharma, which were among the top drags. Midcap and smallcap indices also mirrored the benchmark indices’ softness, continuing to show signs of pressure. On the macroeconomic front, global cues remained cautious after the US Federal Reserve signalled that rate cuts may not happen before September, keeping their stance data-driven and inflation-sensitive. “While the rate cut was priced in, the Fed’s projections of slightly higher inflation and slower GDP growth did inject a cautious undertone. While the Fed has indicated a potential for two rate cuts later this year, possibly totalling 50 basis points, it won’t materialise before September and will be heavily data-dependent, especially on inflation,”— Aishvarya Dadheech, Founder & CIO, Fident Asset Management Overall, traders are expected to tread cautiously in the coming sessions, with focus turning to domestic cues, global monetary policy signals, and ongoing sectoral rotations.

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Editor02 mins

Iran-Israel Conflict Poses Major Economic Threats for India Amid Oil Price Surge and Trade Disruptions

The escalating conflict between Israel and Iran has sparked serious concerns for India’s economy, with analysts warning of a surge in oil import costs and significant disruptions to export routes. The situation worsened after Israel launched strikes on multiple Iranian nuclear and military sites early on Friday, June 13, prompting retaliatory drone attacks from Iran. Global oil prices surged by nearly 8% in just one day following the strikes, fueling fears of inflationary pressure in India, which imports over 80% of its crude oil requirements. Although India currently imports only minimal oil from Iran due to U.S. sanctions, the ripple effects of the conflict are expected to be far-reaching. Amit Kumar, Partner and Energy & Renewables Industry Leader at Grant Thornton Bharat, told that any disruption around the Strait of Hormuz—a critical chokepoint through which 20% of the world’s oil supply flows—could severely affect shipments from key Indian suppliers like Iraq, Saudi Arabia, and the UAE. “The ongoing Iran-Israel conflict is likely to pose risks to oil supply… even if direct imports from Iran are minimal, global price spikes due to conflict will raise crude oil import costs,” Kumar said. Trade experts also warn that the conflict could affect India’s export logistics. Pankaj Chadha, Chairman of the Engineering Exports Promotion Council of India, highlighted that tension in the Middle East could limit access to the Suez Canal and Red Sea shipping routes. “With the Suez route compromised, ships will have to reroute via the Cape of Good Hope, adding 15–20 days of travel time and increasing shipping costs by $500–$1,000 per container. This effectively means a 40–50% hike in export costs,” Chadha explained. Despite the initial spike in oil prices, some analysts believe the market may stabilize. Norbert Rücker, Head of Economics at Julius Baer, said, “This latest conflict eruption follows the usual pattern, with prices rising temporarily before returning to previous levels. The oil market remains resilient, with sufficient storage and spare capacity.” Meanwhile, the price of gold has also spiked, crossing ₹1 lakh per 10 grams, as investors seek safer assets amidst global turmoil. Amit Jain, co-founder of Ashika Global Family Office Services, noted this trend is not merely short-term. “In times of conflict and uncertainty, gold remains the go-to hedge… This is part of a broader uptrend fueled by central bank gold buying, weakening confidence in fiat currencies, and long-term inflation concerns,” he said. As tensions in the Middle East continue, India faces a dual challenge of managing rising import costs and safeguarding its export economy, all while maintaining macroeconomic stability.

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Editor04 mins

India-US Trade Talks Enter Final Stretch Amid Standoff Over Dairy, Agriculture, and Tariffs

India and the United States are in the final phase of negotiating a long-awaited trade agreement, but talks remain tense as both sides grapple with sensitive sectors like dairy, agriculture, digital trade, and medical services. According to insiders, Washington is pressing for greater market access in these areas, while New Delhi is resisting, seeking a balanced agreement that protects its vulnerable sectors. A high-level U.S. delegation, led by Brendan Lynch, Assistant U.S. Trade Representative for South and Central Asia, held extensive talks in New Delhi from June 4 to June 10. While half of the team has returned to the U.S., key negotiators remain in India, pushing for firm commitments. Agriculture and Dairy: Core Flashpoints Former Indian WTO Ambassador Jayant Dasgupta, in an interview with CNBC-TV18, highlighted India’s firm stance against the entry of common U.S. dairy products, citing cultural and market sensitivities. Only niche or “sophisticated” items like certain cheeses, with limited domestic demand, may be considered for import. India also maintains a strict ban on genetically modified (GM) crops, a major sticking point. However, non-GM products with appropriate certification might be allowed. Items such as corn and soybeans, staples in U.S. exports, are still expected to carry high import duties, unless the U.S. agrees to a tariff rate quota (TRQ) system that caps volumes at reduced tariff rates. India’s “Zero-for-Zero” Tariff Demand New Delhi is pushing for a “zero-for-zero” agreement, eliminating tariffs on both sides. But the U.S. is reluctant, reportedly seeking to maintain a 10% tariff on Indian goods. Dasgupta argues that even this reduced duty could work in India’s favour, especially if rival exporters like China and Vietnam continue facing steeper tariffs in the U.S. Trade Pact Timeline India has proposed a three-stage roadmap to finalise the trade agreement: However, Dasgupta cautioned that a complete rollback to pre-Trump tariff levels is unlikely, though moderate reductions may be achievable. Clock Ticking on Reciprocal Tariffs The negotiations are under added pressure due to the 26% retaliatory tariff the U.S. imposed on Indian goods on April 2, which has been temporarily suspended for 90 days, expiring July 9. India is pushing for a full exemption from this duty and is hoping to clinch an early harvest deal to stabilise trade relations and boost investor confidence. As Commerce Minister Piyush Goyal leads parallel discussions in Washington, both nations are striving to bridge differences. The outcome of these talks will be crucial not just for resolving trade tensions but for shaping the future of India-US strategic economic ties in an increasingly volatile global landscape.

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Editor05 mins

India’s External Affairs Minister S. Jaishankar firmly reiterated New Delhi’s stance on terrorism during talks with UK Foreign Secretary David Lammy

India’s External Affairs Minister S. Jaishankar firmly reiterated New Delhi’s stance on terrorism during talks with UK Foreign Secretary David Lammy, stating that India will not tolerate any equivalence between perpetrators of terrorism and their victims. His remarks come amid apparent frustration in New Delhi over international attempts to “hyphenate” India and Pakistan, particularly following last month’s military clashes between the two countries. Key Highlights from Jaishankar-Lammy Meeting: Strategic Outlook: The tone of the Jaishankar-Lammy talks highlights India’s growing assertiveness on the international stage, especially when it comes to terrorism emanating from across its western border. While economic cooperation between India and the UK is deepening, diplomatic sensitivities around security and counter-terrorism remain a flashpoint, particularly when Western powers appear to equate India’s sovereign defensive actions with Pakistan’s support for non-state actors. Lammy’s visit also signals the UK’s post-Brexit strategy to strengthen bilateral ties with major Indo-Pacific players like India, even as it navigates complex geopolitical sensitivities in South Asia.

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Editor04 mins

Bitcoin Poised for Breakout to $130K Despite Trump-Musk Market Jitters

Bitcoin saw a sharp dip this week as a public spat between U.S. President Donald Trump and tech billionaire Elon Musk triggered broader market volatility. The cryptocurrency tumbled nearly 5% — from $106,000 to below $101,000 — amid the fallout on Thursday. However, analysts suggest this downturn may be the final phase of a classic bullish setup, potentially setting Bitcoin on course for a major price rally. Short-Term Dip, Long-Term Opportunity? Despite the recent price correction, technical indicators now point toward a positive outlook for Bitcoin. A widely followed market analyst, known as CrypFlow on X, stated on June 6 that Bitcoin’s chart is showing signs similar to those observed in Q4 2024 — just before the last major surge in price. CrypFlow highlighted three major indicators: Forecast: $130K First Target, $170K Long-Term Potential CrypFlow believes that, if history repeats, Bitcoin could surge by as much as 62% from current levels — potentially reaching $170,000. However, the analyst has set a more conservative near-term target of $130,000, representing a 25% increase from the current market price. Current Market Snapshot Despite market fear, data from Coincodex shows analysts remain optimistic. Their short-term projection sees BTC hitting $134,074 in five days, and $155,864 over the next three months. Bottom Line While the Trump-Musk feud has rattled financial markets, Bitcoin’s technical chart suggests a possible rebound. If historical patterns hold true, the recent dip may be a brief pause before a bullish surge, with $130,000 firmly in sight and a potential climb toward $170,000 over the longer term. Investors should watch closely for confirmation of continued momentum and volume resurgence in the coming days.

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Editor04 mins

Trump–Musk Feud Erupts, Tesla Shares Plunge in Wake of Political Fallout

The once-surprising alliance between U.S. President Donald Trump and tech billionaire Elon Musk has disintegrated in spectacular fashion, triggering political ripples and financial turmoil. The split became public after Musk launched a fierce critique of Trump’s new tax-and-spending bill on social media, labelling it a “disgusting abomination.” The bill proposes ending the popular $7,500 federal tax credit for electric vehicles (EVs) by late 2025—an incentive that has significantly benefited Tesla. Trump swiftly retaliated, threatening to sever government contracts with both Tesla and SpaceX. The President went further during an Oval Office address posted on Truth Social, stating: “The easiest way to save money in our Budget—Billions and Billions of Dollars—is to terminate Elon’s Governmental Subsidies and Contracts. I was always surprised that Biden didn’t do it!” The political drama couldn’t have come at a worse time for Tesla. Already battling slowing global EV demand, regulatory scrutiny, and Musk’s controversial associations with far-right circles, the company has now seen its market value nosedive by over $380 billion since January 2025. Tesla shares dropped 14% on Thursday alone—their largest single-day loss ever—wiping out over $150 billion. The ripple effect also hit Destiny Tech100 Inc., which holds a major stake in SpaceX, sending its stock down 13%. According to Ortex, short sellers netted close to $4 billion in profits from Thursday’s collapse—one of the largest single-day gains ever. Although Tesla shares rebounded slightly on Friday—rising 5.2% to $299.46 at market open before closing up 3.7% at $295.14—the damage to investor confidence was evident. The stock ended the week down 15%, its worst performance since October 2023. Year-to-date, Tesla shares are down 22%, making it the worst performer among the elite “Magnificent Seven” tech stocks. Once ranked eighth globally by market capitalisation, Tesla has now slipped to the tenth spot, with its valuation sitting precariously at around $917 billion. Musk’s exit from the Trump administration last week, reportedly due to mounting shareholder pressure, initially seemed amicable. But it quickly descended into acrimony. The Tesla CEO, once part of the Department of Government Efficiency (DOGE), accused Trump’s new bill of undermining fiscal discipline. Trump, in turn, dismissed Musk’s criticisms as self-serving, hinting that Musk had turned on him because their alliance no longer benefited him. Amid mounting backlash and investor concern, the White House has reportedly tried to mediate, with insiders suggesting a call between Musk and senior officials to de-escalate tensions. However, when asked by a reporter about this potential dialogue, Trump snapped: “You mean the man who has lost his mind? I’m not particularly interested in talking to him right now.” Meanwhile, Apple has also been caught in the tech-sector downturn. The iPhone maker has slipped to the third most valuable global company, with a $2.99 trillion market cap reflecting a 20% decline this year. The fall is attributed to weakening demand in China, AI implementation struggles, and renewed trade tensions under Trump’s leadership. While Musk has shown signs of willingness to make peace—echoing investor Bill Ackman’s call for a truce—the future of Tesla’s government partnerships and long-term valuation remain clouded by political uncertainty. The feud has not only strained two of the most powerful men in America but has also shaken investor faith in Tesla’s resilience amid rising political risks.

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Editor05 mins

Toyota to Take Supplier Toyota Industries Private in $26 Billion Deal, Reshaping Corporate Structure

Toyota Motor Corp (7203.T) announced a major restructuring move on Thursday, confirming a $26 billion deal to take long-time group supplier Toyota Industries Corp (6201.T) private. The acquisition is being led by Toyota Fudosan, an unlisted real estate firm chaired by Toyota’s current Chairman Akio Toyoda, underscoring the continued influence of the automaker’s founding family. The offer, pegged at 3.7 trillion yen ($26 billion), values Toyota Industries at 16,300 yen per share, notably below its recent closing price of 18,400 yen—a surprise to markets expecting a valuation closer to $42 billion, as previously reported. Toyota Industries, which manufactures forklifts, engines, batteries, and converters, has deep historical roots in the Toyota Group. Founded in 1926 as Toyoda Automatic Loom Works by Sakichi Toyoda, it later incubated the automotive division that became Toyota Motor Corp. Toyota currently holds about 24% of Toyota Industries, while the latter owns roughly 9% of Toyota Motor and over 5% of Denso (6902.T), another key Toyota group supplier. As part of the restructuring, Toyota also revealed plans to repurchase its own shares held by Toyota Industries—an effort aimed at untangling cross-shareholding structures and enhancing corporate governance. This move is in line with a broader trend in Japanese corporate reform, where regulators and investors are pressuring conglomerates to improve transparency, governance, and shareholder value. The buyout, though expected, signals a strategic pivot in how Toyota aligns its group entities for the future, especially under the influence of Akio Toyoda’s leadership and legacy vision.

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Editor02 mins

Rupee Falls by 19 Paise to 85.29 Against US Dollar Amid Investor Caution and Weak Equity Market

The Indian rupee slipped by 19 paise to settle at 85.29 against the US dollar in early trade on Tuesday, reflecting a cautious investor outlook amid upcoming key economic data releases. This decline follows a 35 paise gain on Monday, which had marked a brief upward trend for the local currency. Foreign institutional investors (FIIs) showed limited activity, with net equity purchases totaling ₹135.98 crore. Despite a modest decline in global crude oil prices, the rupee remained under pressure due to subdued sentiment in the domestic equity markets and concerns surrounding upcoming industrial production and GDP growth data. Brent crude, the international oil benchmark, dropped by 0.26% to $64.56 per barrel in futures trade, typically a supportive factor for the rupee. However, its positive effect was outweighed by tepid foreign fund flows and cautious investor behavior. Forex analysts observed that the rupee opened at 85.15 before weakening further during the session. On the global front, the dollar index—which tracks the greenback against six major currencies—eased slightly, trading 0.03% lower at 98.83. While this would generally help emerging market currencies like the rupee, the domestic market conditions proved more influential. Indian equities mirrored the rupee’s struggles, with the BSE Sensex falling by 465.46 points (0.57%) to close at 81,710.99. The Nifty also declined by 149.90 points (0.60%), ending the day at 24,851.25. Market experts attributed this downturn to investor hesitation ahead of April’s industrial output data and first-quarter GDP figures, both of which are expected later this week. Analysts maintain that the rupee’s near-term outlook will be shaped by the trajectory of global oil prices and domestic economic indicators. While external cues remain mixed, internal macroeconomic data releases could either deepen or relieve pressure on the local currency and equity benchmarks.

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Editor03 mins
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