Shares in the jewelery segment fell heavily on Monday after Prime Minister Narendra Modi called for a reduction in gold purchases. Share prices of Senco Gold and Kalyan Jewelery fell more than 8%, while Titan fell more than 6%.Speaking at a rally on Sunday, PM Modi called on citizens to help conserve foreign exchange reserves. His appeal included avoiding unnecessary foreign travel, foreign holidays and weddings abroad while supporting domestic tourism. He also called on people to avoid non-essential gold purchases for the next year to ease pressure on foreign exchange outflow.The statement triggered a sharp selloff in jewelery stocks as investors reacted to the potential impact on demand. As of 11:11 am, Senco Gold was trading 8.69% or 31 points lower at 333, Titan 6.45% or 291 points lower at 4,222 on the BSE. Kalyan Jewelers fell 8.3% to 389 and PC Jeweler fell 3.26% to 9.Meanwhile, Dalal Street also traded in the red, with benchmark indices falling amid a mix of geopolitical uncertainty, rising oil prices and fresh concerns over forex conservation following Prime Minister Narendra Modi’s comments.BSE Sensex fell 927.48 points or 1.20% to 76,400.71, while Nifty 50 was down 259.80 points or 1.07% at 23,916.35.Ajay Bagga, banking and markets expert, said, “India is a different story and the PM in a public meeting talked about the energy supply and price challenges for the Indian economy and the need to take measures to reduce energy dependence and imports while preserving foreign exchange. Indian markets are pointing towards a weak start. Expectations of a hike in petrol and diesel prices are high this week as OMC losses are running at Rs 30,000 crore per month.“Bagga also flagged global geopolitical developments as a key headwind for the markets, particularly around the US-Iran situation. “Markets are focusing on AI/Big Tech momentum and ignoring risks from re-escalated US-Iran tensions,” he said. Netanyahu said in an interview yesterday that he thinks the Iran war will not end until Iran’s nuclear facilities are destroyed. The second-order conclusion is that China, which controls Iran, has not seen fit to help the Trump-Xi summit by pressuring Iran to agree to at least a temporary ceasefire.“On the implications of upcoming diplomatic developments, the expert said this could reduce expectations from the Trump-Xi summit, adding, “The expectation is that Trump will try to bypass Xi in the transaction, while coming well prepared with counter-measures to keep the Chinese narrative under control.”Sujan Hazra, chief economist at Anand Rathi, said in a report that despite widespread optimism, crude oil-related risks continued to shape investor caution. “Markets remained optimistic, but jitters over crude never really let up. Indian equities still closed higher, with broader markets outperforming as midcaps and smallcaps continued their strong rally. Autos and IT supported sentiment, while banks and metals struggled under earnings disappointment and rising global uncertainty.“He said India’s economic fundamentals remain strong, supported by strong PMI trends and domestic demand, but warned that higher oil prices, logistics disruptions and tensions over the Strait of Hormuz are adding to inflation concerns.“Globally, central banks remain cautious about cutting rates as energy-based price pressures complicate the outlook. Growth is stalling, but global risks are beginning to make flexibility more costly,” Hazra said.(Disclaimer: The recommendations and views given by experts on the stock market, other asset classes or personal finance management are their own. These opinions do not represent the views of The Times of India)
