The Core Report

#835 Sensex Hits Two Year Low as Oil Crosses $115 per Barrel

28 min

Indian markets, including the Sensex and Nifty, have hit multi-year lows due to record FII outflows of $12 billion in March and Brent crude prices surging past $115 a barrel amidst the escalating West Asia crisis. Simultaneously, the global private credit market is facing significant distress with trapped investor capital and rising default rates, raising concerns about systemic risk. India's strategy focuses pragmatically on securing energy and raw material flows, diversifying sources, and avoiding geopolitical intervention in the West Asia conflict.

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✨ Key Takeaways

1

Indian Markets Plummet

The Sensex and Nifty recorded their worst showing since 2020, with foreign institutional investors (FIIs) selling a record *$12 billion* in March, and the Rupee hitting an *11%* fall for the fiscal year.
2

Oil Prices Soar

Brent crude crossed *$115 a barrel*, marking a *58%* monthly jump (steepest since 1988) due to the West Asia war, with analysts warning of *$150* oil and unavoidable *retail fuel price hikes* in India.
3

Global Private Credit Distress

The *$2 trillion* global private credit market, or "shadow banking," is experiencing a wave of redemption requests, trapping *$4.6 billion* in investor capital, with Fitch reporting a *9.2%* default rate and estimates of *30%* value at risk.
4

India's Pragmatic West Asia Strategy

India is prioritizing the *uninterrupted flow of energy* (oil, LPG, LNG) and raw materials through the Strait of Hormuz, actively diversifying its supply sources globally, and refraining from direct geopolitical intervention.

💬 Notable Quotes

"“See, private credit is what we also refer to as shadow banking. What happened after 2008? The bank capital rules became very strict. So, investors started looking for funds or borrowers started looking for funds elsewhere and that led to this shadow banking growth.” — Ajay Bhaggan"
"“Jamie Diamond of JP Morgan has said there are a lot of cockroaches in the private credit.” — Ajay Bhaggan"
"“Our game is to make sure that the ships that are coming to us with fertilizer, with oil, with LPG, what have you, make it through the straits.” — Indrani Bhak"