Iran-Israel Tensions: How do they impact Indian stock market? Here's what experts say

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Reuters. Even though the Indian market sank today, experts do not see any long-term repercussions of the Middle East conflict on the Indian indices. "The escalation in the potential conflict between Iran & Israel is a serious development and will likely adversely impact oil pricing.

The Indian markets will be pressured over the short term as well. However, the Indian economy’s strong fundamentals and growth trajectory remain firmly in place over the long term," said Samir Bahl, CEO - Investment Banking, Anand Rathi Advisors. Meanwhile, V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, as well, noted that signals from the crude market indicate that the tensions are unlikely to escalate but advises caution to investors in the short term "There are many headwinds that weighed on markets today: the renewed conflict in the Middle East, proposed changes in the India-Mauritius tax treaty, and the hotter-than-expected US inflation are negatives.

But partly these negatives are in the price since a retaliation from Iran was expected and the higher US inflation was discounted by the market on Friday. Signals from the crude market indicate that the Iran-Israel conflict is unlikely to escalate. President Biden has clearly indicated that he doesn’t support Israeli retaliation.

So, the situation may calm down. However, investors have to be guarded since the element of uncertainty is high during a tense situation like this," said the expert. Ajit Mishra – SVP, Research, Religare Broking, stated that markets are reacting largely in line with other global counterparts on the news of fresh escalation in the Middle East.