Coal, aluminium, gold will likely gain from Iran war

by Hansraj Agrawal | Mar 4, 2026 | Business

Coal prices have increased by 18 per cent, aluminium rates by 6 per cent, and gold stands to gain significantly due to the hostilities in the Persian Gulf with the US, and Israel pitted against Iran.

“Following US-Israeli strikes on Iran over the weekend of February 28-March 1, we think gold could reach a new all-time-high above $5,600/oz this week if no signs of de-escalation materialise,” said research agency BMI, a unit of Fitch Solutions.

Gold, which soared to over $5,350 an ounce at the beginning of the week, has pared its gains on a strong dollar and fears of hike in interest rates, to below $5,200 an ounce by Wednesday evening. Reports from the US said that Iran had reached out to the Donald Trump administration for an end to the War.

Cash for liquidity

However, analysts say that the selling in gold seen recently, leading to prices see-sawing, is because investors needed cash for liquidity.

Last week, just before the hostilities broke out, ING Think, the financial and economic analysis arm of Dutch multinational financial firm ING, said that though the momentum in gold may moderate, structural drivers underpinning the market are firmly in place – and in some cases are strengthening.

“…we think gold can still trade higher this week, potentially reclaiming $5,600/oz and posting a fresh all-time-high,” said BMI.

Two reasons

It attributed two reasons to this. The first was the lack of certainty surrounding the duration of the current geopolitical risk premium in oil prices.

“Without a clear consensus on how long the conflict and the associated premium will last, markets will shelter in haven assets like gold,” the research agency said..

The second factor for gold being bullish stems from physical disruption to the bullion market if flights are unable to transit through Dubai, which is one of the world’s largest gold refiners.

“Although this is unlikely to materially affect the physical market, which is highly liquid and well stocked, the premise of disruption will bolster bullish sentiment, in our view,” said BMI.

At 1905 hours IST, gold was quoted at $5,189 an ounce, while the yellow metal’s April futures on COMEX ruled at $5,196.44 an ounce.

Upside risks

ING Think said the escalation in the conflict in the Persian Gulf increased upside risks to physical aluminium premiums, rather than materially tightening global supply.

“The Middle East accounts for around 8 per cent of global aluminium capacity and is heavily reliant on the Strait of Hormuz for both metal exports and alumina imports, with key producers being Saudi Arabia, the UAE and Bahrain,” it said.

BMI expects aluminium to see the largest gains from disruption in the Middle East, with prices ruling near $3,350/tonne currently.

“Heightened risks of disruption in the Strait of Hormuz, a critical export corridor for Middle East aluminium producers, have compounded existing supply-side concerns. Collectively, the UAE and Bahrain accounted for an estimated 6 per cent of global aluminium output in 2025 (around 4.3 million tonnes),” it said.

Fuel switch buoys coal

Reports said aluminium has also surged in view of Qatar halting production due to the tensions in the Persian Gulf region. It will take at least six months for production to resume at Qatalum, a joint venture between Qatar and Norsk Hydro ASA.

BMI said aluminium prices will likely remain near $3,300/tonne in the coming weeks. Any further material escalation would amplify supply-side pressures and present significant upside risk.

“With the market already set to run a deficit in 2026, we believe a deterioration in conditions … could lift prices to $3,500,” said the research agency.

BMI said it sees upside risk for seaborne prices of thermal coal if Strait of Hormuz disruption affects the availability of Qatari liquefied natural gas (LNG), which could encourage fuel switching in key markets such as Japan and South Korea. Qatar has shut down its LNG facilities, a rate event, in view of the crisis after Iranian drones attacked the country’s LNG hub.

“Gas prices have already spiked, with benchmark Henry Hub prices up almost 4% and approaching $3/MMBtu. If the availability of Qatari LNG is constrained for more than a week, a potential winner would be seaborne thermal coal,” said the research agency.

Demand for Indonesia, Australian coal

This would be a temporary and significantly more limited repeat of the situation when the Ukraine war broke out in 2022. Then, the buying of natural gas from Russia got cut, leading to a spike in demand for thermal coal.

On Wednesday, Newcastle thermal coal futures (May) ruled at $138 a tonne, a 16-month high. Qatar accounts for four-fifths of LNG supply in Asia and nearly 15 per cent of global.

Though coal trade is not carried through the Strait of Hormuz, expectations of Japan and South Korea switching to coal from LNG has raised prices of Australian and Indonesia coal by 15 per cent since the beginning of this week.

Published on March 4, 2026

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Indian 10-year G-Sec yield steady at 6.67% despite crude oil surge

by Hansraj Agrawal | Mar 4, 2026 | Business

The benchmark 10-year Government Security (6.48% 2035 GS) yield closed almost flat at 6.6732%, compared to the previous close of 6.68%.

The Government Securities (G-Secs) market seems to be weathering the impact of the likely increase in inflation due to a spike in global crude oil prices, as Banks are supporting yields amid year-end considerations and traders are drawing comfort from India’s reasonable energy buffer.

Yield of the benchmark 10-year G-Sec (6.48 per cent 2035 GS) on Wednesday closed almost flat at 6.6732 per cent (previous close: 6.68 per cent). This comes amid a jump in crude oil prices following the West Asia conflict.

Venkatakrishnan Srinivasan, Founder & Managing Partner, Rockfort Fincap LLP, observed that the G-Sec market has remained relatively stable despite heightened global volatility triggered by escalating geopolitical tensions in West Asia.

“Brent crude moving above $82 per barrel and the rupee weakening toward the 92 level against the dollar would normally exert upward pressure on yields due to concerns around imported inflation and macro stability.

“However, the benchmark 10-year G-sec yield has actually softened during the day, moving from around 6.72% to nearly 6.67%, indicating that domestic demand and technical factors are currently providing support to the market,” he said.

Venkatakrishnan observed that as year-end closure approaches, banks become particularly sensitive to mark-to-market (MTM) implications on their government securities portfolios.

“A sharp rise in yields would translate into valuation losses on bonds held in their available-for-sale and trading books. So, banks generally tend to support the market and may not allow the 10-year yield to sustainably move much beyond the 6.70% level unless the external crisis worsens materially,” he said.

At the same time, the market is also drawing comfort from India’s current energy buffer. Government and industry sources indicate that India has crude oil and petroleum product inventories sufficient to meet demand for roughly 50 days, which reduces the risk of an immediate inflation shock even if crude prices remain elevated in the near term.

Published on March 4, 2026

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State Bank of India recruits 5,783 junior associates

by Hansraj Agrawal | Mar 4, 2026 | Business

Signage at the State Bank of India (SBI) headquarters in Mumbai
| Photo Credit:
ABEER KHAN

State Bank of India (SBI) recruited 5,783 Junior Associates across States and Union Territories out of the 9,00,771 candidates who applied for the positions.

With this latest round of recruitment, India’s largest Bank has added over 18 ,000 new employees to its workforce across roles and grades during the current fiscal year, marking one of its most expansive talent induction drives in recent years.

SBI Chairman Challa Sreenivasulu Setty said, “The induction of the fresh talent pool underscores our sustained commitment to strengthening frontline capabilities and elevating customer experience nationwide. As we chart our path to doubling our total business to ₹200 lakh crore over the next five to six years, we intend to onboard around 16,000 employees annually to power this growth journey.”

This recruitment drive is to further strengthen customer service and branch operations across the country, SBI said in a statement.

The Preliminary Examinations were conducted in September 2025, following which 1,20,006 candidates were shortlisted for the Main Examination held in November 2025. SBI currently has over 2,48,000 employees.

Published on March 4, 2026

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SEBI approves BSE launch of Sensex Next 30 futures and options contracts

by Hansraj Agrawal | Mar 4, 2026 | Business

Market experts view the move as structurally positive, offering investors exposure to emerging large-cap companies likely to graduate to the flagship index.
| Photo Credit:
FRANCIS MASCARENHAS

The capital market regulator SEBI has allowed BSE to launch derivative contracts on the “BSE Sensex Next 30 Index”.

The index tracks the largest and most liquid companies in the BSE 100 that are in the derivatives segment and not members of the BSE Sensex 30 index.

The Sensex Next 30 Index tracks emerging large-cap companies poised to join the flagship index, presenting a compelling thematic play on future market leaders.

The exchange will offer cash-settled monthly index futures and monthly index options with expiry dates on the last Thursday of each expiry period, it said.

Rajesh Palviya, Head of Research, Axis Securities, said the approval for BSE to launch derivative contracts on the Sensex Next 30 Index marks a structurally positive development for equity markets.

Amid regulatory tightening that has elevated margin requirements and curbed excessive speculation, the launch is unlikely to trigger an immediate surge in trading volumes, he said.

However, over time, this differentiated product could draw informed investors and institutions seeking diversified exposure beyond the benchmark Sensex, said Palviay.

Even with stricter norms, product innovation remains appealing to serious traders and hedgers. While retail participation may start cautiously, proprietary desks, hedge funds, and portfolio managers stand to uncover relative-value and arbitrage opportunities, he added.

While regulations temper speculative excess, high-quality index products with proven depth and credibility will sustain long-term investor interest.

Published on March 4, 2026

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Speed is not always a virtue in finance: RBI Dy Guv Swaminathan

by Hansraj Agrawal | Mar 4, 2026 | Business

Deputy Governor of Reserve Bank of India Swaminathan J speaking at the 3rd International Finance and Accounting Conference at Indian Institute of Management (IIM) Jammu

Speed is not always a virtue in finance as it sometimes hides weakness, according to Swaminathan J, Deputy Governor, RBI.

“A product can reach ten million people within months. A credit model can approve loans in seconds. A payments platform can process massive volumes,” he said.

“This scale is powerful, but it also means that harm can scale quickly if design is poor, controls are weak, or incentives are misaligned,” Swaminathan said in his recent speech at the 3r^dInternational Finance and Accounting Conference at the Indian Institute of Management (IIM), Jammu.

He noted that technology is a force multiplier, which amplifies good design as well as bad design.

“Eventually, the future will reward institutions that can combine efficiency and innovation with prudence, and growth with resilience,” the Deputy Governor said.

Swaminathan underscored that in finance, small compromises can become large losses.

“There will be moments where the easy path is tempting. A shortcut in due diligence; A small compromise on disclosure; A “temporary” relaxation of standards; or A target that encourages aggressive sales. These compromises may look small in the moment, but they compound,” he cautioned.

He emphasised that finance needs numbers, but more importantly, it also needs integrity in numbers.

“In the age of dashboards and AI, it is easy to forget that accounting is a discipline of clarity. It forces us to recognise losses, admit uncertainty, value assets prudently, and explain performance in a way that others can rely on,” he added

“In many organisations, the true difference between a good institution and a weak one is not how fast it grows, but how truthfully it measures itself,” he said.

The Deputy Governor observed that many problems in finance start small, sometimes, quite literally, in the ‘small print’.

“A fee not explained clearly; A clause buried in the terms; A loan that is easy to take but hard to repay; or A product sold to meet a target, not to meet a need,” he said.

“Over time, these small problems become big issues. They show up as complaints, disputes, defaults, and customer harm,” he said.

Therefore, finance professionals should endeavour to design and sell products that are suitable, transparent, and fair. The best leaders prevent harm before it occurs. They do not wait for problems to become headlines.

Published on March 4, 2026

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Rupee continues to feel reverberations of West Asia war; sinks to record closing low of 92.15/$

by Hansraj Agrawal | Mar 4, 2026 | Business

The Rupee’s weakness also comes in the backdrop of the US Dollar (USD) gaining strength against other currencies as global investors are piling into Dollar assets due to risk-off sentiments
| Photo Credit:
KSL

The Rupee continued to feel the reverberations of the war in West Asia, weakening 120 paise against the US Dollar in the last two trading sessions amid concerns over the negative impact that the spike in global crude oil prices could have on India’s current account balance and inflation.

The rupee on Wednesday sank 68 paise to close at an all-time low of 92.15 per US Dollar (USD). This came on top of the 52-paise decline in rupee against the US dollar on Monday.

The Rupee’s previous all-time closing low was 91.96 per dollar on January 29.^.

Dollar strength

The Rupee’s weakness also comes in the backdrop of the US Dollar gaining strength against other currencies as global investors are piling into Dollar assets due to risk-off sentiments in the midst of geopolitical tensions arising from the attack by the US-Israel combine on Iran and retaliatory strikes by the latter.

V Rama Chandra Reddy, Head – Treasury, Karur Vysya Bank, noted that the fallout of the ongoing West Asia war is that the Rupee continues to be under pressure, with a strong Dollar, FPI outflows from the domestic equity markets and rising crude oil prices vitiating market sentiments.

He said the central bank likely intervened at the 92.25-92.30 level, which strengthened the Rupee to 92.05 before it closed at a record low.

Reddy opined that if the war prolongs, there could be implications for the current account balance, with the possibility of the deficit widening due to higher crude oil prices and remittances from the Gulf Co-operation Council countries getting impacted. This, in turn, can pressure the Rupee.

Nomura assessed that every 10 per cent oil price change worsens India’s Current Account by 0.4 percentage points. In India, it expects a higher import bill and risk-aversion driven portfolio outflows to increase BOP (balance of payments) funding pressure in the near term, while higher oil prices will reinforce the RBI’s on-hold stance and can add to fiscal risks.

According to Nomura Economists Sonal Varma and Aurodeep Nandi, India’s major external sector risk, though, is not from its current account, but from the capital account, where a sharp drop in foreign investment flows is leading to a large balance of payments deficit in FY26. A combination of a widening current account deficit and FII outflows due to global risk aversion could accentuate rupee weakness, they said.

Oil Impact

Anindya Banerjee, Head Currency and Commodity Research, Kotak Securities, USDINR has surged to a fresh all-time high near 92.30 in the spot market, driven by the sharp rise in crude oil prices and a broader shortage of dollar liquidity in global markets amid the escalating conflict involving Iran, the US, and Israel.

“We expect the RBI to intervene periodically to contain excessive volatility and prevent a disorderly depreciation in the rupee. However, as long as crude oil prices remain elevated, the rupee could continue to face depreciation pressures,” he said.

Banerjee underscored that the key variable to monitor now is the status of the Strait of Hormuz, a critical artery for global oil shipments. The longer disruptions persist, the higher oil prices are likely to move, which in turn could push USDINR further upward.

Conversely, any quick de-escalation in the conflict and restoration of normal shipping flows through Hormuz could help stabilise crude prices and provide some relief to the rupee.

Published on March 4, 2026

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