U.S.-Iran MoU cools risk premium, putting gold ETFs under pressure as equities regain appeal

The U.S. and Iran have signed a memorandum of understanding, easing geopolitical tensions and lifting expectations for better crude oil supply and lower energy prices. Experts say that could ease inflation pressures, improve visibility on corporate earnings and make equities more attractive. Gold ETFs saw their first monthly outflow in 13 months in May 2026, at ₹725 crore, while equity mutual funds posted net inflows of ₹22,908 crore over the same period, up 20% year on year. Indian equities are trading below their long-term median valuation, and foreign investor ownership is near a 17-year low.