Asian shares are trading on a negative note today. Asian shares hit a 14-month low on the back of worries that a new round of Sino-US tariffs could come at any moment. The Nikkei 225 is down 1.1% while the Hang Seng is down 0.8%. The Shanghai Composite is trading down by 0.1%.

Back home, India share markets opened the day on a negative note. The BSE Sensex is trading down by 125 points (down 0.3%) while the NSE Nifty is trading down by 27 points (down 0.2%). The BSE Mid Cap index is trading flat, while the BSE Small Cap index has opened the day down by 0.1%.

Sectoral indices have opened the day on a mixed note with healthcare stocks, power stocks and banking stocks witnessing maximum selling pressure.

The rupee is trading at 71.88 to the US dollar.

In the news from commodity markets, crude oil prices are witnessing buying interest today. Gains are seen as data showed that US crude inventories fell to their lowest levels since February 2015.

Note that oil prices have climbed steadily this year, helped by rising demand. This is seen on the back of signs that Iran sanctions may limit global crude oil supply.

As per a leading financial daily, oil customers for Iran have started to drastically wind down purchases of Iranian crude ahead of the US sanctions. This was evident from Iran’s exports plunging by 6,00,000 barrels per day (bpd) in August compared with July loadings due to declining flows to India.

On the back of above worries, market participants are worried that Iranian sanctions could severely undersupply the oil market in 2018 and that will mean a further rise in crude oil prices.

But rising crude oil prices don’t bode well for the Indian economy, as it not only affects fuel prices but also has many other repercussions on the macroeconomic level.

They can be a big worry for the Modi government as well as it has been a big beneficiary of lower crude oil prices.

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