Indian Shares Set To Plunge As Trump-Iran Threats Escalate

(RTTNews) - Indian shares are seen opening sharply lower on Monday as investors fret about the spillover effects of elevated energy costs from the Middle East conflict to inflation and global economic growth.

The war between the United States and Iran's regime has entered an unprecedented phase, escalating fears of a wider regional conflict.

As the conflict entered its fourth week, Washington and Tehran have traded fresh threats following a wave of damaging Iranian strikes on Israel.

Iran's Natanz nuclear enrichment facility was hit in an airstrike Saturday. Two Iranian strikes on towns near Israel's main nuclear research center injured more than 100 people.

U.S. President Donald Trump has threatened to "hit and obliterate" Iran's power plants if Tehran does not reopen the Strait of Hormuz— a vital artery for global energy flows — within 48 hours.

Tehran warned of retaliation, threatening to close the strait and target energy infrastructure and desalination facilities in the Gulf if the U.S. carries out its ultimatum.

Any attacks on the country's power plants would "immediately" be met with retaliatory strikes on energy and oil infrastructure across the region, Iran's Parliament speaker Mohammad Bagher Ghalibaf said.

Ghalibaf also said entities that finance the U.S. military budget are "legitimate targets" for the country, alongside military bases.

Asian markets tumbled, with benchmark indexes in Hong Kong, South Korea and Japan falling 3-5 percent.

The dollar held gains from the previous session and ten-year U.S. Treasury ?yields hovered near an eight-month high while gold prices slumped nearly 2 percent toward $4,400 an ounce as investors wager on higher interest rates globally.

Brent crude prices were up nearly 1 percent above $107 a barrel in early Asian trade while WTI crude futures were up half a percent at $99 a barrel.

U.S. stocks fell for a third straight session on Friday as bond yields surged on inflation fears following new attacks on energy infrastructure in the Middle East.

Adding to investor anxiety, CBS reported that Pentagon officials have drawn up detailed preparations for deploying U.S. ground troops into Iran.

Axios reported that the Trump administration is mulling a forced takeover of Iran's Kharg Island, a key oil-export site, to put pressure on Iran to reopen the Strait of Hormuz.

The Wall Street Journal reported that the Pentagon is deploying three more warships and thousands of additional Marines to the Middle East.

Trump suggested in an interview with MS Now's Stephanie Ruhle that the U.S. would continue to attack Iran until they can "never rebuild." Trump later told reporters he is not interested in a ceasefire with Iran.

The tech-heavy Nasdaq Composite plummeted 2 percent, the S&P 500 slumped 1.5 percent and the Dow gave up 1 percent to reach their lowest closing levels in over six months.

European stocks ended deep in the red on Friday, giving up early gains on concerns that major central banks will soon hike interest rates to combat inflation.

The pan European Stoxx 600 fell 1.8 percent. The German DAX tumbled 2 percent, France's CAC 40 lost 1.8 percent and the U.K.'s FTSE 100 shed 1.4 percent.