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Iran war impact in April 2026 likely largely sentiment-driven, with investors repositioning portfolios in response to uncertainty, If tensions persist in May, impact begins to transmit into macro variables, Prolonged conflict in June may begin to have a more visible economic impact

* Iran war impact in April 2026 likely largely sentiment-driven, with investors repositioning portfolios in response to uncertainty
* If tensions persist in May, impact begins to transmit into macro variables
* Prolonged conflict in June may begin to have a more visible economic impact

shorts/business/daily-voice-us-iran-war-extends-into-june-quarter-what-could-shape-market-outcomes-puneet-sharma-of-whitespace-alpha-explains

If the US-Iran conflict prolongs, the impact is likely to evolve in phases rather than play out uniformly, said Puneet Sharma, the CEO and Fund Manager at Whitespace Alpha, CAT3 AIF, in an interview with Moneycontrol.

Across all three phases (April, May, June 2026), he believes the shift is from short-term sentiment-driven volatility to deeper fundamental repricing, which is what ultimately shapes market outcomes.

According to him, Q4FY26 is likely to be a relatively mixed quarter. The impact of March volatility is more likely to reflect in management commentary, forward guidance, and cautious outlooks rather than sharply in reported numbers, he said.

Do you think Donald Trump is likely to take all necessary steps to de-escalate the Iran war in April, given the midterm elections later this year?

I think President Trump would certainly prefer a quick de-escalation if it can be achieved without looking strategically weak. The political incentive is obvious, no US administration wants a prolonged geopolitical conflict heading into an election-sensitive year.

At the same time, Trump’s policy style has historically combined pressure tactics with negotiation leverage, so I would not assume an immediate or clean resolution just because the political calendar demands it. The more likely outcome, in my view, is an attempt to contain escalation rather than a full and swift settlement within April.

What could be the potential impact on markets, economy, earnings, globally if the West Asia war continues through April, May, or June, particularly amid rising fears of an Iran ground invasion? Could you explain the depth of the impact on a month-wise basis?

If the conflict prolongs, the impact is likely to evolve in phases rather than play out uniformly.

April – Sentiment &amp;amp; Positioning Phase:

The initial reaction is typically driven by risk aversion. Markets tend to correct, volatility spikes, oil prices move higher, and currencies weaken. The impact during this phase is largely sentiment-driven, with investors repositioning portfolios in response to uncertainty.

May – Transmission Phase:

If tensions persist, the impact begins to transmit into macro variables. Elevated oil prices start reflecting in inflation expectations, currency pressures remain, and financial conditions tighten.

At a corporate level, input cost pressures begin to build, and margin expectations start getting revised. Market behaviour also becomes more selective, with dispersion across sectors and stocks increasing.

June – Fundamental Adjustment Phase:

A prolonged conflict begins to have a more visible economic impact. Growth expectations may be revised lower, earnings estimates could see downgrades, and policy responses become more relevant.

At this stage, markets move from reacting to uncertainty to pricing in actual macro adjustments.

Across all three phases, the shift is from short-term sentiment-driven volatility to deeper fundamental repricing, which is what ultimately shapes market outcomes.

Could inflation cross 5 percent if Iran war-led disruptions persist, or remain below 5 percent if the US and Iran reach a resolution by April 15?

At this stage, inflation is largely being dictated by energy prices and supply-side dynamics. If the conflict leads to sustained disruption and crude prices remain elevated, inflation could move above the 5 percent mark in the near term.

On the other hand, a timely resolution would ease supply concerns, normalize energy prices, and help keep inflation more contained. It’s important to note that India is entering this phase with relatively stable macro conditions, so any inflationary spike is more likely to be cyclical rather than structural.

The key variable to watch here is not just the headline inflation number, but the persistence of elevated energy prices over time.

What is your outlook for equity markets in FY27, and what kind of returns can be expected if the war ends this month?

We remain structurally positive on India, supported by domestic growth drivers, policy continuity, and improving capital formation. The Nifty 50 continues to be a strong proxy for this long-term growth trajectory.

If geopolitical tensions ease in the near term, it could remove a key overhang and support a recovery in market sentiment. However, even in such a scenario, returns are unlikely to be linear. Markets typically move through phases of expansion, consolidation, and volatility.

So, while the broader direction remains constructive, investors should be prepared for intermittent volatility rather than a smooth upward trajectory.

What do you expect from the Q4FY26 earnings season, which begins next week? Have you made any significant changes to your estimates due to the March impact?

Q4 is likely to be a relatively mixed quarter. Certain sectors may see margin pressures due to higher input costs and currency volatility, while others could continue to benefit from stable demand conditions.

The impact of March volatility is more likely to reflect in management commentary, forward guidance, and cautious outlooks rather than sharply in reported numbers.

At an aggregate level, earnings growth should remain intact, but expectations may be recalibrated slightly in the near term as companies factor in global uncertainties.

Have the worst-case scenarios for the Indian rupee largely played out?

A large part of the panic may already be behind us, but I would not say all the worst-case scenarios are fully off the table yet. The rupee did hit an all-time low of 95.23 per dollar, so clearly the market has already priced in a meaningful amount of stress. Since then, the RBI’s tightening of FX rules has triggered a sharp pullback, with the rupee recovering into the low-93 zone. That tells you two things: first, positioning had become stretched; second, the RBI is not comfortable allowing disorderly weakness.

So, my view is that the extreme one-way panic has likely played out, but the rupee will still remain highly sensitive to oil, capital flows, and geopolitical headlines. If the Iran situation cools and crude stabilizes, the rupee can recover further. But if oil remains elevated, I would still avoid calling the all-clear too early.

A status quo on rates now seems likely—what do you expect from the RBI’s commentary, and what will be the key focus areas?

The RBI is likely to maintain a balanced stance, acknowledging external risks while focusing on domestic stability. The emphasis will be on inflation trajectory, liquidity management, and currency stability. Rather than signaling aggressive policy shifts, the central bank is expected to retain flexibility and respond as conditions evolve.

Even in a status quo, liquidity conditions and volatility cycles will drive market behaviour more than direction.

Which investment themes are currently on your radar for FY27?

Rather than focusing on specific sectors, the more relevant theme in the current environment is the nature of market behaviour itself.

With global uncertainties and intermittent volatility, returns are likely to be uneven, making consistency and disciplined execution more important than directional or sector-specific positioning.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.

Daily Voice | US-Iran war extends into June quarter: What could shape market outcomes? Puneet Sharma of Whitespace Alpha explains

FIIs still maintain a strong net short positioning in index futures, Nifty continues to exhibit weakness, trading below key short-term and long-term moving averages, Decisive break below 22,350 would indicate continuation of downtrend toward 22,200-22,000

* FIIs still maintain a strong net short positioning in index futures
* Nifty continues to exhibit weakness, trading below key short-term and long-term moving averages
* Decisive break below 22,350 would indicate continuation of downtrend toward 22,200-22,000

shorts/business/chartist-talk-is-nifty-50-s-bearish-momentum-losing-strength-is-nifty-it-s-pullback-rally-set-to-continue-next-week-sudeep-shah-answers

According to Sudeep Shah, the Head - Technical and Derivatives Research at SBI Securities, despite the negative bias in closing, neither bulls nor bears seem to have established firm control on the Nifty 50. Historically, such phases of indecision often act as a precursor to a decisive breakout.

On a positive note, the index recently found support near an upward-sloping trendline, followed by a swift rebound, and additionally, a positive divergence is evident on the daily RSI, suggesting that the underlying weakness may be losing momentum, he said in an interview with Moneycontrol.

That said, this divergence still requires validation through price action, with the 22,900–23,000 zone remaining a key resistance band, while immediate support lies in the 22,400–22,350 range, he added.

Meanwhile, in view of the recent technical developments, he believes that Nifty IT is poised to continue its pullback rally in the short term, while the rising ratio line in the NALCO/Hindalco ratio chart suggests that between the two, NALCO is relatively outperforming the latter, and better poised to lead the rally.

Are FII positions signalling that the market is likely to remain under bearish control next week as well?

Foreign Institutional Investors (FIIs) have continued their intense selling activity, offloading Rs 9,931 crore in the cash segment on Thursday and extending their selling streak to 23 straight sessions. This has pushed the cumulative outflows to a massive Rs 1,51,804 crore in 2026, reflecting a sustained risk-off sentiment among global investors.

In the derivatives space, the long-short ratio has seen a marginal uptick to 16.84 percent from 16.20 percent. However, FIIs still maintain a strong net short positioning in index futures. The ratio has broadly hovered within the 10–16 percent band since early March, with no significant signs of short covering even during recent market pullbacks.

Technically, the Nifty continues to exhibit weakness, trading below its key short-term and long-term moving averages. The RSI has struggled to move above the 40 mark, signaling persistent bearish momentum. Immediate resistance is seen in the 22,950–23,000 range, and the index is likely to stay under pressure unless it decisively breaks above this zone.

Do you see a higher probability of the Nifty 50 breaking 21,700 rather than surpassing the 23,000–23,500 range next week?

Nifty once again witnessed a brief 1–2 day recovery, only to be followed by a sharp gap-down opening—an ongoing sequence that has been playing out consistently since the US–Iran war-triggered decline began. This pattern continues to unfold even in this truncated week.

With this, marking the sixth straight week of losses, the index continues to end in the red, underscoring persistent weakness. However, could this repetitive behaviour be quietly building the base for a larger move ahead?

On the weekly chart, the past three candles display shadows on both ends, reflecting a clear lack of directional conviction. Despite the negative bias in closing, neither bulls nor bears seem to have established firm control. Historically, such phases of indecision often act as a precursor to a decisive breakout.

On a positive note, the index recently found support near an upward-sloping trendline drawn from the swing lows of January 2024, followed by a swift rebound. Additionally, a positive divergence is evident on the daily RSI, while prices have been making lower lows, the RSI has been forming higher lows, suggesting that the underlying weakness may be losing momentum.

That said, this divergence still requires validation through price action.

The 22,900–23,000 zone remains a key resistance band. A sustained move above 23,000 could pave the way for a pullback towards 23,300 and subsequently 23,500. On the downside, immediate support lies in the 22,400–22,350 range. A decisive break below 22,350 would indicate a continuation of the downtrend, potentially dragging the index towards 22,200 and even 22,000, making this a crucial make-or-break zone in the near term.

Are you confident that bears will push the Bank Nifty to its March 2025 lows before any kind of recovery next week?

The banking benchmark, Bank Nifty, ended the week in negative territory for the sixth straight week. However, after touching a low of 49,954, the index staged a strong recovery, forming a Dragonfly Doji candlestick pattern. This pattern reflects robust buying interest emerging at lower levels following the recent sharp decline.

Although the index is still trading below its key moving averages, momentum indicators are showing signs of improvement. The daily RSI has formed a positive divergence, indicating that bearish momentum is losing strength. Similarly, the MACD histogram points toward a moderation in downside pressure.

From a levels perspective, the 52,000–52,200 range is likely to act as an immediate resistance zone. A decisive move above 52,200 could trigger a pullback rally towards 53,000, with further upside potential extending to 53,600 in the near term.

On the downside, the 50,900–50,700 band is expected to provide strong support. A breakdown below 50,700 may signal a continuation of the downtrend, potentially dragging the index towards 50,000 and then 49,400 in the short term.

What are your top two stocks to bet on for next week?

Arvind

Arvind witnessed a healthy pullback from its 200-day EMA a couple of sessions ago, a level that has consistently acted as strong support, as seen during the rebounds since early March. The stock has also given a downward-sloping trendline breakout on the daily chart. The DI+ crossing above DI- on the ADX indicator signals increasing buying strength and dominance of bulls over bears.

Additionally, the MACD line has crossed above the signal line, further reinforcing positive momentum. Overall, the confluence of these indicators suggests a strengthening bullish undertone with potential for further upside. Hence, we recommend accumulating the stock in the zone of Rs 366-362 with a stop-loss of Rs 350. On the upside, it is likely to test the level of Rs 390 in the short term.

Steel Authority of India

SAIL has been consolidating within the Rs 158–142 range since March 6, 2026. During this phase, the stock repeatedly dipped below its 100-day EMA but swiftly reclaimed it, highlighting strong underlying support. The RSI slipped below the 40 mark thrice during this period but consistently held above it, indicating sustained bullish undertone.

Meanwhile, the ratio line in the Nifty Metal/Nifty ratio chart has made a new high, signaling sustained relative outperformance. Overall, price action, supported by sectoral strength, suggests a likely breakout above the consolidation zone in the near term. Hence, we recommend accumulating the stock in the zone of Rs 154-157 with a stop-loss of Rs 147. On the upside, it is likely to test the level of Rs 168 in the short term.

Do you think the Nifty IT index has bottomed out, considering its behaviour over the last two weeks?

Nifty IT has been undergoing a phase of consolidation for the last 24 trading sessions. During the same period, the frontline indices have witnessed a sharp sell-off, highlighting the relative outperformance of the IT index. The ratio chart of Nifty IT against Nifty is forming a sequence of higher tops and higher bottoms, reinforcing its relative strength.

Additionally, Mansfield’s Relative Strength indicator has seen a strong rebound and is on the verge of crossing above the zero line, clearly indicating that Nifty IT is outperforming the frontline indices. The index has also moved above its 20-day EMA for the first time since February 2026. In view of these technical developments, we believe that Nifty IT is poised to continue its pullback rally in the short term.

Do you see Nykaa maintaining its uptrend next week?

FSN E-Commerce Ventures (Nykaa) continues to trade within a narrow Rs 248–232 range since March 13, 2026, despite a strong 2.5 percent gain on April 2. The stock is hovering around its 200-day EMA, making this a crucial level to watch. The RSI has rebounded from 40, indicating early signs of improving momentum.

However, it still trades below its 20 and 50-day EMAs, suggesting a cautious undertone. The MACD remains below the zero and signal lines, while a flat ADX indicates a lack of trend strength. A decisive breakout above Rs 248 could trigger upside, while a breakdown below Rs 232 may invite fresh selling pressure.

What is your view on Hindalco and NALCO, which have rallied over the last couple of weeks?

Hindalco Industries and National Aluminium Company have witnessed a strong rally over the past couple of weeks, supported by robust sectoral momentum. The ratio line in the Nifty Metal/Nifty ratio chart has moved to a new high, indicating clear outperformance versus the broader market.

Hindalco has rebounded nearly 9.5 percent from its March 23 low, while NALCO has surged around 15.5 percent from its 50-day EMA, reflecting stronger momentum. The rising ratio line in NALCO/Hindalco ratio chart suggests that between the two, Nalco is relatively outperforming the latter. With strong sectoral support, any follow-through buying could extend the upmove, with NALCO better poised to lead the rally.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.

Chartist Talk: Is Nifty 50’s bearish momentum losing strength? Is Nifty IT’s pullback rally set to continue next week? Sudeep Shah answers

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404035324_Nifty_sensex.jpg" alt="In the truncated volatile trading week, the Indian market ended lower for the sixth consecutive week amid ongoing geopolitical tensions, rising crude oil prices, and weak global markets. However, losses were partially capped by support from IT, metal stocks and a stronger Indian rupee, which helped the market recover from deeper declines." width="1280" height="720" class="size-full wp-image-13879794" /> In the truncated volatile trading week, the Indian market ended lower for the sixth consecutive week amid ongoing geopolitical tensions, rising crude oil prices, weak global markets and sustained selling by Foreign Institutional Investors (FIIs). However, losses were partially capped by support from IT, metal stocks and a stronger Indian rupee, which helped the market recover from deeper declines.

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404035518_sensex_nifty_sensexdown.jpg" alt="During the week, the BSE Sensex fell 263.67 points, or 0.35%, to end at 73,319.55, while the Nifty 50 was down 106.5 points, down 0.46%, to finish at 22,713.10." width="1280" height="720" class="wp-image-13879795 size-full" /> During the week, the BSE Sensex fell 263.67 points, or 0.35%, to end at 73,319.55, while the Nifty 50 was down 106.5 points, down 0.46%, to finish at 22,713.10.

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404035614_sensex_nifty_stock-stocks_stock.jpg" alt="On the sectoral front, the Nifty Healthcare and Nifty Pharma indices declined sharply, shedding over 3 percent each. Meanwhile, Nifty Consumer Durables, Nifty PSU Bank, Nifty Private Bank, and Nifty Auto also ended lower, falling around 1 percent each. On the other hand, Nifty IT, Nifty Metal, and Nifty India Defence indices outperformed the broader market, gaining 2–3 percent during the session." width="1280" height="720" class="size-full wp-image-13879796" /> On the sectoral front, the Nifty Healthcare and Nifty Pharma indices declined sharply, shedding over 3 percent each. Meanwhile, Nifty Consumer Durables, Nifty PSU Bank, Nifty Private Bank, and Nifty Auto also ended lower, falling around 1 percent each. On the other hand, Nifty IT, Nifty Metal, and Nifty India Defence indices outperformed the broader market, gaining 2–3 percent during the session.

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404035729_sensex_nifty_market_Nifty_nse_bse.jpg" alt="During the week, Bharti Airtel witnessed the highest erosion in its market capitalisation, followed by Sun Pharmaceutical Industries, NTPC Limited, and ICICI Bank. On the other hand, Tata Consultancy Services, Infosys Limited, and Bharat Electronics Limited recorded gains in their market capitalisation." width="1280" height="720" class="wp-image-13879799 size-full" /> During the week, Bharti Airtel witnessed the highest erosion in its market capitalisation, followed by Sun Pharmaceutical Industries, NTPC Limited, and ICICI Bank. On the other hand, Tata Consultancy Services, Infosys Limited, and Bharat Electronics Limited recorded gains in their market capitalisation.</dd><dd class="wp-caption-dd">

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404040025_sensex_nifty_stock_markets.jpg" alt="The BSE Smallcap index gained nearly 1 percent, supported by strong buying in select stocks. Latent View Analytics, Ola Electric Mobility, Carborundum Universal, and Birlasoft Limited surged 10–20 percent during the session. Other notable gainers included Fine Organics Industries, Garden Reach Shipbuilders &amp; Engineers, RHI Magnesita India, Poly Medicure, Mastek Limited, Tata Chemicals, Chambal Fertilisers and Chemicals, Chennai Petroleum Corporation, BLS International Services, and Relaxo Footwears. However, losses were seen in stocks such as Gravita India, Apar Industries, PG Electroplast, Emcure Pharmaceuticals, Sobha Limited, Aether Industries, PTC Industries, Syngene International, and Minda Corporation." width="1280" height="720" class="size-full wp-image-13879802" /> The BSE Smallcap index gained nearly 1 percent, supported by strong buying in select stocks. Latent View Analytics, Ola Electric Mobility, Carborundum Universal, and Birlasoft Limited surged 10–20 percent during the session. Other notable gainers included Fine Organics Industries, Garden Reach Shipbuilders &amp; Engineers, RHI Magnesita India, Poly Medicure, Mastek Limited, Tata Chemicals, Chambal Fertilisers and Chemicals, Chennai Petroleum Corporation, BLS International Services, and Relaxo Footwears. However, losses were seen in stocks such as Gravita India, Apar Industries, PG Electroplast, Emcure Pharmaceuticals, Sobha Limited, Aether Industries, PTC Industries, Syngene International, and Minda Corporation.

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404040102_sensex_nifty1.jpg" alt="The BSE Midcap index declined 0.5 percent, weighed down by losses in Authum Investment &amp; Infrastructure, Ashok Leyland, Blue Star Limited, Voltas Limited, Ipca Laboratories, Max Financial Services, Mahindra and Mahindra Financial Services, Schaeffler India, SBI Cards and Payment Services, and ICICI Prudential Life Insurance Company. On the other hand, gains were seen in Lloyds Metals and Energy, National Aluminium Company, Godrej Industries, Page Industries, Persistent Systems, AIA Engineering, Procter and Gamble Hygiene and Health Care, IRB Infrastructure Developers, and Coforge Limited." width="1280" height="720" class="size-full wp-image-13879803" /> The BSE Midcap index declined 0.5 percent, weighed down by losses in Authum Investment &amp; Infrastructure, Ashok Leyland, Blue Star Limited, Voltas Limited, Ipca Laboratories, Max Financial Services, Mahindra and Mahindra Financial Services, Schaeffler India, SBI Cards and Payment Services, and ICICI Prudential Life Insurance Company. On the other hand, gains were seen in Lloyds Metals and Energy, National Aluminium Company, Godrej Industries, Page Industries, Persistent Systems, AIA Engineering, Procter and Gamble Hygiene and Health Care, IRB Infrastructure Developers, and Coforge Limited.

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404040204_rupeegain_dollar.jpg" alt="The Indian rupee snapped its four-week losing streak, posting its biggest gain in more than 12 years during Friday’s session. Earlier in the week, it had weakened past the 95 mark for the first time, hitting a record low of 95.12 on Monday. For the week, the domestic currency ended 171 paise stronger at 93.10 against the March 27 closing level of 94.81." width="1280" height="720" class="size-full wp-image-13879806" /> The Indian rupee snapped its four-week losing streak, posting its biggest gain in more than 12 years during Friday’s session. Earlier in the week, it had weakened past the 95 mark for the first time, hitting a record low of 95.12 on Monday. For the week, the domestic currency ended 171 paise stronger at 93.10 against the March 27 closing level of 94.81.

<img src="https://images.moneycontrol.com/static-mcnews/2026/04/20260404040240_stock-market.jpg" alt="Foreign Institutional Investors (FIIs) extended their selling streak for the seventh consecutive week, offloading equities worth ₹29,425.34 crore. In contrast, Domestic Institutional Investors (DIIs) remained net buyers, purchasing equities worth ₹29,274.93 crore during the same period." width="1280" height="720" class="size-full wp-image-13879808" /> Foreign Institutional Investors (FIIs) extended their selling streak for the seventh consecutive week, offloading equities worth ₹29,425.34 crore. In contrast, Domestic Institutional Investors (DIIs) remained net buyers, purchasing equities worth ₹29,274.93 crore during the same period.

Market declines for sixth straight week; Rupee rebounds from record low

From April 1, 2026, every derivatives trader in India woke up to a heavier cost structure. STT on futures jumped from 0.02% to 0.05%. On options, it moved from 0.1% to 0.15%.

Numbers that look small on paper. But in trading, small numbers compound fast, and they always compound against you.

Here is what makes STT particularly significant: it is not a tax on your profits. It is a tax on your activity. Win or lose, every transaction is taxed on turnover. In a market where retail participation is highly active, especially around expiry days, this is not a minor adjustment.

It is a structural shift in your breakeven. If you do not adapt, the market will quietly drain your account through the sheer cost of trading.

Stop Overtrading, Especially on Expiry Day

The first change is behavioral. More trades do not mean more opportunity. They mean more cost.

With the new STT rates, small scalping gains no longer cover transaction costs. This is especially true on expiry day, when premiums are low and traders chase quick setups.

What most do not calculate: on a ₹10 premium with a lot size of 65, STT at 0.15% works out to ₹1.12 per lot. Do that across 20 lots, multiple times in one afternoon, and the costs stack up silently. You do not feel it in individual trades. Your gross P&amp;amp;L looks positive. Your net P&amp;amp;L is negative.

Trade less. Trade better.

Move From Intraday to Short-Term Positional

Frequent entries multiply your STT burden. A positional trade held for 2 to 5 days carries the same STT cost as a single intraday trade, but gives your setup time to work.

There is a second benefit. Short timeframes expose you to whipsaws, false moves that shake you out before the real trend begins. A slightly longer holding period reduces that noise and leads to more consistent results.

Options Over Futures

This is the most important shift the new STT creates. Futures STT has risen by 150%. When you add minimum brokerage, Nifty futures now need around 13 points to break even, Bank Nifty needs 27, and Sensex requires about 40. That is before you make a single rupee of profit.

Options costs did rise, but far less steeply. More importantly, options give you flexibility. You can structure trades around volatility, price levels, and days to expiry. You define your risk upfront. Futures simply cannot offer that.

Be Selective With Option Buying

When buying options, focus only on high-probability setups. Avoid chasing small premiums. Before entering any trade, calculate your full breakeven including STT and brokerage. If the math does not work, the trade does not work.

STT is here to stay. The traders who adapt will quietly find an edge. The ones who keep trading the old way will keep wondering where their money went. The market does not care about your intentions. It responds to your cost structure. Get that right, and you give yourself a real chance.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

New STT, New Rules | How derivatives traders must adapt: Shubham Agarwal

RBI may raise rates by 25–50 bps in FY27 if energy-driven inflation persists, Capex decisions could be delayed due to Iran war uncertainty, Believe valuations still elevated for defence sector, however, fundamental trajectory appears robust

* RBI may raise rates by 25–50 bps in FY27 if energy-driven inflation persists
* Capex decisions could be delayed due to Iran war uncertainty
* Believe valuations still elevated for defence sector, however, fundamental trajectory appears robust

shorts/business/daily-voice-rbi-may-raise-rates-by-25-50-bps-in-fy27-if-energy-driven-inflation-persists-capex-decisions-could-be-delayed-due-to-iran-war-uncertainty-says-client-associates-himanshu-kohli

According to Himanshu Kohli, the Co-founder of Client Associates, the RBI may stay on hold in the near term; but if energy-led inflation persists and broadens, 25–50 bps of rate hikes in FY27 are likely.

In Q4FY26 earnings, he expects managements across the board to be more cautious in their commentaries given the recent developments in the West Asia.

Further, the capex decisions are likely to get delayed given the uncertainty, he said in an interview to Moneycontrol.

Despite recent corrections, Himanshu believes the valuations are still elevated for defence sector; however, fundamental trajectory appears robust.

Do you see any resolution to the war in the short term, considering the statements from countries directly involved in the West Asia conflict?

Despite efforts from both sides, geopolitical tensions continue to remain elevated in the fifth week of the conflict. Many of the Gulf countries whose economies are largely dependent on crude oil exports are getting severely impacted. There have been early indicators of some waivers being negotiated by a few countries regarding passage through Strait of Hormuz, however it is too premature to conclude on a lasting resolution to this conflict.

As per the latest round of rhetoric, it appears the war could extend further, and the resolution is unlikely in the immediate term.

Can any data points force the countries to stop the war?

History shows that extended war is not good for any country. Over time, it enters the financial markets through the commodity channel feeding into inflation. This in turn can lead to second order impact on demand and start hurting the economy, corporates and end consumers if the conflict sustains for a longer period.

Using the war play book, the impact on financial markets historically tends to last for 2-6 weeks from the start of the conflict. However, we are in the fifth week already and it is difficult to predict whether this time it will be any different.

Do you think most of the negativity is already priced in by the markets? Does this mean the market will consolidate before getting any strong trigger for recovery?

While we believe a large part of negativity appears to be priced in after a sharp correction, further downside cannot be completely ruled out if the situation escalates further or sustains for a much longer period. Indian benchmark indices fell around 11.5 percent in March amid the war’s onset, with record FII outflows (Rs 1.2 lakh crore) even as DIIs continued to be net buyers to the tune of Rs 1.3 lakh crore.

Volatility spiked, bond yields hardened, and rupee continued to slide during the month as inflation expectations and widening CAD (current account deficit) risks surfaced with oil at elevated levels. History shows that markets react sharply to geopolitical conflicts, but impact is short lived. Markets tend to bounce back strongly in the next 12-18 months.

For markets to remain meaningfully impacted, crude price needs to remain elevated on a sustained basis which could lead to higher inflation eating into corporate margins. We believe markets are likely to consolidate until a strong positive trigger emerges even as valuations remain attractive and earnings prospects have been improving.

Do you expect the biggest impact of the war on earnings in Q1FY27, with a limited impact in Q4FY26?

If we were to extrapolate what happened during the Russia-Ukraine war, the higher crude prices likely impact margins with a one quarter lag. Given the war started in March and government and OMCs (oil marketing companies) largely cushioned the impact of crude prices, Q4FY26 earnings may only see a marginal impact on earnings.

The margin compression is likely to be felt in Q1FY27 and possibly in Q2FY27 if the conflict persists. Sectors such as Materials (chemicals, paints, fertilizers, cement, metals), OMCs, utilities, logistics, airlines and consumer staples may see the largest impact on margins. The second order impact could be in terms of demand slowdown if the crisis elongates.

What do you expect from management commentaries following their Q4 earnings announcements?

We expect managements across the board to be more cautious in their commentaries given the recent developments. Most companies may acknowledge short-term geo-headwinds (oil volatility, currency depreciation, supply disruptions) while reaffirming long-term resilience via domestic demand and policy support.

Capex decisions are likely to get delayed given the uncertainty. The future guidance of impacted sectors mentioned earlier are likely to get trimmed to some extent.

Do you maintain a bullish view on defence companies amid geopolitical tensions? Also, do you see a significant increase in export opportunities going ahead?

We maintain a constructive view on Indian defence amid the ongoing West Asia conflict and broader global re-arming. The sector is transitioning from import-dependency to indigenisation and design-led manufacturing. Global military spending has accelerated in recent years, while India’s FY27 defence budget has also increased by 15 percent to Rs 7.8 lakh crore, collectively reinforcing a capex cycle across air, naval, and advanced defence systems.

Export momentum is a critical catalyst. Having reached a record Rs 23,600 crore in FY25, we anticipate exports to hit the government’s Rs 50,000 crore target by FY29, spurred by demand from West Asia and Africa for cost-competitive platforms. Furthermore, growing focus on localization is driving margin expansion and supply-chain resilience.

Despite recent corrections, the valuations are still elevated for the sector; however, fundamental trajectory appears robust. The combined revenue of listed defence PSUs is expected to grow at a 16 percent CAGR, while their PAT is forecasted to grow at a 14 percent CAGR over the FY25-28 period.

What are the key buying opportunities in the current market turmoil?

The current scenario brings us back to the fundamentals of investing. Asset Allocation and diversification remain the cornerstone of investing for tiding through volatile times. Buying on dips remains an opportune strategy.

We prefer opportunities in well researched market cap and sector agnostic actively managed products with strong focus on risk management. In terms of sectoral allocations, we prefer structural opportunities like Financials (attractive valuations, robust growth outlook, financialisaton of savings theme), Consumer Discretionary (Direct and Indirect tax rationalisation, favourable valuations, strong demand outlook, preference for Autos and Auto Ancillary) and Defence plays. However, we need to be mindful that there could be near term headwinds if the geopolitical conflict sustains longer.

What do you expect from the RBI for 2026?

As we enter the new financial year, RBI’s policy backdrop has become increasingly challenging with surging crude oil prices driving the inflation risks upwards. While the government has tried to absorb part of the shock, increased concerns over fiscal deficit is driving yields higher. Further, elevated credit demand from government is also adding to yields hardening with the benchmark 10-year G-Sec yield breaching the 7 percent mark recently.

Since India entered this phase with inflation still relatively contained (CPI of 3.21 percent in February 2026) the RBI may stay on hold in the near term; but if energy-led inflation persists and broadens, 25–50 bps of rate hikes in FY27 are likely. On the currency side, the RBI is likely to keep using regulatory tightening (as it did for banks’ forex positioning last week) and market intervention (using forex reserves) to control volatility.

To offset the liquidity, drain from such forex operations, it may also continue supporting the bond market through OMOs (open market operations) or other liquidity measures as needed.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.

Daily Voice: RBI may raise rates by 25–50 bps in FY27 if energy-driven inflation persists; capex decisions could be delayed due to Iran war uncertainty, says Client Associates' Himanshu Kohli

12 out of 17 years NIFTY SERV SECTOR has given positive returns in April.

Type	R1	R2	R3	PP	S1	S2	S3
Classic	29,293.85	29,608.25	30,138.85	28,763.25	28,448.85	27,918.25	27,603.85
Fibonacci	29,086.04	29,285.46	29,608.25	28,763.25	28,440.46	28,241.04	27,918.25
Camarilla	29,056.91	29,134.37	29,211.82	28,763.25	28,901.99	28,824.53	28,747.08

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