09/10/26, Global equity markets came under pressure on Thursday, with major indices across Asia

Even though the Nifty 50 slipped to its 52-week low in trade on October 8, the sell-off is not confined to India.

Global equity markets came under pressure on Thursday, with major indices across Asia, Europe and the US trading lower as a combination of rising oil prices, higher bond yields, renewed inflation fears and escalating Middle East tensions weighed on risk appetite.

The Nifty 50 fell 1.6%, but the weakness was broad-based across global markets. Japan's Nikkei and Hong Kong's Hang Seng declined 1.4% each, while China's CSI 300 fell 1.1%.

In Europe, Germany's DAX was down 1.1% and France's CAC 40 slipped 0.7%. US equities also remained under pressure, with the Dow Jones, S&P 500 and Nasdaq falling 0.4%, 0.4% and 0.5%, respectively.

The sell-off comes as investors grapple with rising concerns over inflation and interest rates. Global markets are increasingly pricing in the possibility that the US Federal Reserve could raise rates again before the end of the year, while a fresh round of inflation warnings from European Central Bank policymakers has added to uncertainty over the path of monetary policy.

Sovereign bond markets have also come under pressure. Higher US Treasury yields have supported the dollar, while the euro remained close to a 17-month low amid concerns over France's fiscal position. The widening of French bond spreads has also spilled over into Italian and Greek debt markets and parts of the European banking sector.

Oil has emerged as another major source of uncertainty for markets. Brent crude rose 1.52% to $101.73 a barrel, while West Texas Intermediate gained 1.4% to $89.50.

The latest spike in crude prices follows an increase in attacks on shipping in the Gulf and renewed concerns over the security of oil supply routes through West Asia.

The prospect of potential US military action against Iran has added to those concerns. US President Donald Trump has instructed the military to be prepared for a strike against Iran, although the timing remains under consideration.

Attacks on tankers transiting the Strait of Hormuz have further heightened concerns among traders about disruptions to one of the world's most important oil shipping routes.

Source: Network18

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