Winning Bizness Desk

Mumbai.It has been two months since the United States-Iran war began on 28 February 2026, and despite an official ceasefire, reports of violations continue to surface. The prolonged tension, especially around the Strait of Hormuz, remains the biggest concern for global markets. With more than 30% of the world’s oil and nearly 20% of India’s supplies passing through this route, uncertainty over crude movement has kept investors cautious and risk-averse.

Global markets react sharply to conflict uncertainty

The outbreak of the war triggered immediate volatility across global asset classes, forcing investors to reassess risk exposure. Initial panic led to sharp corrections, followed by selective recovery in some markets. However, the broader sentiment continues to be weighed down by oil disruptions and geopolitical instability.

Key asset performance over two months:

• Indian markets: 81,287.19 to 77,303.63 points, down 5%
• Pakistan markets: 1,68,062 to 1,69,475 points, up nearly 1%
• US markets: 48,977.92 to 49,230.71, up 0.5%
• Gold: ₹1,59,097 to ₹1,51,495 per 10 gm, down 5%
• Silver: ₹2,67,900 to ₹2,44,103 per kg, down 9%
• Oil: $70 to $106 per barrel, up 51%
• Indian rupee: 91/$ to 94/$, down 3%

Indian markets remain among worst-hit globally

Indian equity markets have emerged as one of the biggest casualties of the conflict. Benchmark indices Sensex and Nifty have consistently declined, reflecting investor anxiety over economic fallout. The Sensex has dropped 5% over the two-month period, wiping out massive investor wealth running into lakh crore rupees. Persistent foreign fund outflows and rising crude prices have added to the pressure.

Pakistan stocks outperform Indian counterparts

In contrast, Pakistan’s equity markets have delivered modest gains. The KSE-100 index has risen by 1,413 points, or nearly 1%, during the same period. This relative outperformance has surprised analysts, especially given the broader regional instability.

US markets show resilience amid global stress

American markets have demonstrated notable resilience. Despite an initial fall, indices such as the Dow Jones Industrial Average have nearly recovered losses. The index has moved from 48,977.92 before the war to 49,230.71, delivering a marginal gain of 0.5%, indicating investor confidence in the US economy’s stability.

Precious metals fail to act as safe haven

Contrary to expectations, gold and silver have declined during the conflict period.

• Gold prices dropped by ₹7,602 per 10 grams, or 4.7%
• Silver prices fell by ₹23,797 per kilogram, or 8.8%

This trend suggests that investors did not fully shift towards traditional safe-haven assets, possibly due to liquidity needs and a stronger dollar environment.

Oil prices surge amid supply disruption fears

Brent crude has been the standout performer, rising sharply amid fears of supply disruptions in West Asia. Prices have climbed from $70 per barrel before the war to $106, marking a 51% increase. The volatility continues as markets react to every geopolitical development linked to the Strait of Hormuz.

Rupee weakens as capital outflows intensify

The Indian rupee has depreciated by 3% against the US dollar, falling from 91 to 94. Capital outflows by foreign investors seeking safer assets have exerted pressure on the currency. Despite intervention by the Reserve Bank of India, the rupee remains weak, pushing up import costs and fuelling inflation concerns.

Overall, among all major asset classes, oil has delivered the highest returns during the two-month conflict period, while Indian equities and precious metals have generated negative returns, and US markets have remained largely stable.