global trade tensions

Chinese President Xi Jinping invoked the "Thucydides Trap" during talks with US President Donald Trump, highlighting concerns that the rising power's growth could lead to conflict with the established dominant power. This theory, popularized by Graham Allison, suggests structural tensions make war more likely, a concept now central to global geopolitical debates involving trade wars and technological competition.

Rupee hit a fresh record low of 96.07 against the US dollar on Friday, extending its losing streak over three straight sessions amid soaring crude oil prices and escalating tensions in West Asia. At the interbank foreign exchange market, the rupee opened at 95.86 against the US dollar and slipped further to 95.94, down 30 paise from its previous close.

President Trump embarks on a crucial three-day visit to China, set to engage in high-stakes talks with President Xi Jinping. Discussions will span critical global issues including the Middle East conflict, Taiwan, AI, and nuclear weapons. Business leaders are accompanying Trump, signaling a focus on trade and potential new deals, as both nations navigate complex economic and security landscapes.

Indian markets brace for a volatile week, with the US-Iran conflict and soaring crude oil prices dominating investor sentiment. A weakening rupee, coupled with inflation concerns, adds to the pressure. Analysts anticipate heightened sensitivity to geopolitical developments, especially concerning the Strait of Hormuz, and will closely watch foreign investor activity and upcoming economic data.

US staff and press accompanying President Trump reportedly discarded materials from Chinese officials before departing Beijing. This occurred despite public displays of goodwill, as behind-the-scenes tensions over security and media access surfaced during the visit, echoing past diplomatic friction.

Foreign funds net sell 8.4K crore stocks; investors poorer by 6 lakh crore

US President Trump revealed Chinese President Xi Jinping desires the Strait of Hormuz reopened to stabilize global energy markets. Both leaders reportedly agreed on the necessity of this crucial shipping route's resumption. Discussions also touched upon potential increased Chinese purchases of American oil and agricultural products, alongside ongoing tensions regarding Taiwan.

External Affairs Minister S Jaishankar criticized "unilateral coercive measures" and sanctions, stating they disproportionately harm developing nations and cannot replace diplomacy. He also voiced concern over the West Asia crisis, emphasizing the need for uninterrupted maritime traffic and a sustained ceasefire in Gaza, advocating for a two-state solution.

The Sensex tumbled over 1,000 points to slip below the 74,300 mark, while the Nifty 50 dropped more than 300 points to trade under 23,350. The steep decline erased nearly Rs 7 lakh crore from the total market capitalisation of BSE-listed companies, reducing it to around Rs 454 lakh crore.

Geopolitical tensions in the Middle East are significantly impacting India's economy. Rising crude oil prices have led to a Rs 3 per litre fuel hike, eroded investor wealth by over Rs 5.85 lakh crore, and pushed the rupee to an all-time low. Foreign investors are also withdrawing funds, while the import bill has surged.

Despite the bullish undertone in equities, several risk factors continue to keep investors on edge. The rupee touched a fresh record low after breaching the 95.8 mark against the US dollar for the first time.

Wall Street's market sentiment has shifted from 'TACO' (Trump Always Chickens Out) to 'NACHO' (Not A Chance Hormuz Opens), reflecting growing pessimism about the Strait of Hormuz crisis. Investors now anticipate a prolonged period of elevated oil prices and shipping risks, moving away from assumptions of a quick resolution.

In a significant diplomatic gesture, President Trump has welcomed Chinese President Xi Jinping and his spouse to the White House on September 24th, calling it a historic meeting of minds. Central to their discussions was the crucial issue of ensuring stable global energy flows through the strategically vital Strait of Hormuz, with both leaders underlining its significance.

Oil prices surged over 2% on Monday, driven by escalating Middle East tensions and stalled de-escalation efforts. Reports of a nuclear power plant attack and potential US military options against Iran further unsettled markets. Both Brent and WTI crude saw significant gains, continuing a sharp rally from the previous week.

China has agreed to purchase over 200 Boeing aircraft. This deal could expand to 750 planes. The agreement follows President Donald Trump's visit to China and meeting with President Xi Jinping. This marks a significant order for Boeing. GE Aerospace will supply the engines. The deal is important for China's aviation expansion.

Russian Foreign Minister Sergey Lavrov suggested India could play a long-term diplomatic role in mediating US-Iran tensions, while Pakistan facilitates immediate dialogue. Lavrov highlighted India's diplomatic experience and global standing, noting its direct stake in West Asian stability and energy security.