Deepak Shenoy, market veteran and CEO of Capitalmind Mutual Fund, welcomed the strong move seen in the markets globally, including in India, following the two-week ceasefire in the US-Iran war, but expressed doubts about the credibility of statements made by those involved.
The , as the Sensex gained nearly 3000 points and the Nifty 50 added 870 points to reclaim the 24,000 mark. The US and Iran agreed to a two-week ceasefire, sending crude prices lower on expectations that energy supplies from the Middle East could resume, boosting risk-on sentiments.
Equity indices in major shot up between 4%-5%. while crude oil prices tumbled 16%.
Shenoy welcomes the optimism in the market and hopes that it will last, but sounds wary of the statements made by the parties involved.
“Super move on the markets. I somehow find it incredible that we take statements at face value, from the same set of people that have lied to us for the last month. Optimism is a good thing of course, let’s hope it lasts,” said Shenoy in a post on X on Wednesday.
To err on side of caution!
Shenoy’s comment comes as US President , in the last one month since the Middle East crisis began, has made conflicting statements.
On multiple occasions in the past, he has suggested an earlier end to the war, while on the flipside, Iran has denied all reports of negotiations.
Even on Tuesday, the ceasefire deal was reached less than two hours before Trump’s deadline for Tehran to reopen the , marking an abrupt turnaround from his extraordinary warning earlier.
The eleventh-hour deal was subject to Iran’s agreement to pause its blockade of oil and gas supplies through the strait, Trump said. The Strait accounts for a fifth of the world’s crude oil passage.
“This will be a double sided CEASEFIRE!” Trump wrote on his Truth Social platform. “The reason for doing so is that we have already met and exceeded all Military objectives, and are very far along with a definitive Agreement concerning Longterm PEACE with Iran, and PEACE in the Middle East.”
Trump, who has issued a series of threats in recent weeks only to back away, said progress between the two sides had prompted him to agree to the ceasefire. He said Iran had presented a 10-point proposal that was a “workable basis” for negotiations and that he expected an agreement to be “finalised and consummated” during the two-week window.
Trump later said to AFP: “We have a 15-point transaction, of which most of those things have been agreed on. We’ll see what happens. We’ll see if it gets there.” Meanwhile, to AFP, he said it was a “total and complete victory” when asked if he was claiming victory with the ceasefire.
It was not immediately clear how soon the ceasefire elsewhere would take full effect.
Ceasefire is a pause, not resolution to war
The and rattled markets globally, pushing indices to their worst monthly performance in years. Shenoy’s message of remaining cautiously optimistic is key amid the flip-flop statements by the US President.
Analysts, earlier today, pointed out that the sustained market stability will hinge on whether this temporary truce evolves into a more durable de-escalation. Harshal Dasani, Business Head at INVAsset PMS, said that the ceasefire should be seen as a pause rather than a resolution. “The ceasefire is time-bound, safe passage remains conditional, and negotiations are still at a fragile stage.”
(With inputs from agencies)
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