Mumbai: Benchmark indices are expected to open lower as crude oil prices jumped after US President Donald Trump rejected Iran's latest proposal to end the war, denting hopes of a near-term resolution to the conflict. Futures tied to major US indices traded lower in the early trade while Asian indices were largely mixed.
Over the weekend, Iran sent a new proposal to US negotiators, centred on ending the over two-month-long conflict, Iran's semi-official news agency Tasnim said. The counteroffer didn't include commitments about Tehran's nuclear program, according to a report by Dow Jones Newswires. In response, Trump, in a social media post Sunday, said that Iran's reply to the US proposal to end the conflict was unacceptable.
"I have just read the response from Iran's so-called 'Representatives.' I don't like it - Totally unacceptable!" The July futures contract of Brent crude in the Intercontinental Exchange rose 4.2% to $105.5 per barrel following Trump's rejection.
At 0820 IST, the contract traded over 3% higher at $104.8 per barrel. Trump's rejection of Iran's latest offer to end the war points to the risk of prolonged uncertainty over the US-Iran conflict, Dow Jones Newswires reported, citing MUFG Bank's Lloyd Chan in a research report.
Heavyweight SK Hynix surged almost 12% in early trade, and shares of its parent company, SK Square Co., were up nearly 6%. Samsung Electronics was also over 6% higher, and the benchmark KOSPI index was up by more than 4%. Japan's Nikkei 225 index touched a new high, but it pared all gains and slipped into negative territory.
In another development, China announced that Trump will make a state visit from May 13 to 15 at the invitation of President Xi Jinping. The two leaders and their delegations are expected to work through a sweeping agenda spanning trade, technology, rare-earth export controls, Taiwan, the war in Iran, and artificial intelligence, according to media reports. The May futures contract of Gift Nifty indicates a negative start to the domestic market.
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