Dalal Street extends gains as Iran-US peace deal eases inflation concerns
The S&P BSE Sensex gained 306.22 points, or 0.40%, to 76,570.55 in early trade, while the NSE Nifty50 rose 72.95 points, or 0.31%, to 23,926.85 as of 9:36 am.
Benchmark stock market indices opened higher on Tuesday, extending gains for a third straight session as easing tensions in West Asia and a sharp correction in crude oil prices continued to support investor sentiment.
The S&P BSE Sensex gained 306.22 points, or 0.40%, to 76,570.55 in early trade, while the NSE Nifty50 rose 72.95 points, or 0.31%, to 23,926.85 as of 9:36 am.
The market rally came after a preliminary peace agreement between the United States and Iran eased fears of a prolonged conflict and helped bring crude oil prices sharply lower. Brent crude remained below the crucial $84 per barrel mark, trading at $82.99 a barrel, while WTI crude hovered around $80.74.
The decline in oil prices is a major positive for India, which imports more than 85% of its crude requirement. Lower crude prices reduce pressure on inflation, the current account deficit and the rupee, improving the overall macroeconomic outlook.
Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said the sharp correction in Brent crude and a stable rupee could provide resilience to Indian markets.
“The sharp correction in Brent crude to below $84 and stability in the rupee have the potential to impart resilience to the market. The strong macro headwind of rising BoP deficit is no longer a serious issue plaguing the economy,” he said.
He added that the rupee has appreciated to 94.71 against the US dollar from its recent low of 96.96, which could help reduce sustained foreign investor selling.
However, he cautioned that renewed strength in the AI trade and momentum in markets such as South Korea and Taiwan may continue to divert foreign portfolio investor (FPI) flows away from India. He also flagged concerns over the progress of the monsoon and the possibility of inflationary pressures if rainfall remains below normal.
Among sectoral indices, Nifty IT emerged as the top gainer, rising 1.43%, followed by Nifty Consumer Durables, which climbed 0.91%, Nifty Media, up 0.64%, and Nifty Financial Services, which gained 0.42%.
However, metal stocks remained under pressure, with Nifty Metal declining 1.52%, making it the biggest sectoral loser in early trade.
Among Sensex stocks, HCLTech led the gains, rising 3.11%, followed by Bajaj Finserv (1.61%), Bajaj Finance (1.60%), Hindustan Unilever (1.55%), Tech Mahindra (1.46%) and TCS (1.44%).
Other gainers included Larsen & Toubro, Infosys, Bharti Airtel and HDFC Bank.
On the other hand, Axis Bank was the biggest laggard, falling 1.10%, followed by UltraTech Cement (-0.56%), Tata Steel (-0.48%), Power Grid (-0.42%), BEL (-0.40%) and Trent (-0.40%).
The broader market also remained firm. Nifty Midcap 50 rose 0.35%, Nifty Midcap 100 gained 0.31%, while Nifty Smallcap 100 advanced 0.42%, indicating continued buying interest beyond large-cap stocks.
While easing geopolitical risks and falling crude prices have supported the recent rally, analysts believe markets may not witness a one-way move.
Factors such as foreign investor activity, the strength of the global AI-led rally, domestic valuations and the progress of the monsoon will remain key triggers for Dalal Street in the coming weeks.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)
Benchmark stock market indices opened higher on Tuesday, extending gains for a third straight session as easing tensions in West Asia and a sharp correction in crude oil prices continued to support investor sentiment.
The S&P BSE Sensex gained 306.22 points, or 0.40%, to 76,570.55 in early trade, while the NSE Nifty50 rose 72.95 points, or 0.31%, to 23,926.85 as of 9:36 am.
The market rally came after a preliminary peace agreement between the United States and Iran eased fears of a prolonged conflict and helped bring crude oil prices sharply lower. Brent crude remained below the crucial $84 per barrel mark, trading at $82.99 a barrel, while WTI crude hovered around $80.74.
The decline in oil prices is a major positive for India, which imports more than 85% of its crude requirement. Lower crude prices reduce pressure on inflation, the current account deficit and the rupee, improving the overall macroeconomic outlook.
Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said the sharp correction in Brent crude and a stable rupee could provide resilience to Indian markets.
“The sharp correction in Brent crude to below $84 and stability in the rupee have the potential to impart resilience to the market. The strong macro headwind of rising BoP deficit is no longer a serious issue plaguing the economy,” he said.
He added that the rupee has appreciated to 94.71 against the US dollar from its recent low of 96.96, which could help reduce sustained foreign investor selling.
However, he cautioned that renewed strength in the AI trade and momentum in markets such as South Korea and Taiwan may continue to divert foreign portfolio investor (FPI) flows away from India. He also flagged concerns over the progress of the monsoon and the possibility of inflationary pressures if rainfall remains below normal.
Among sectoral indices, Nifty IT emerged as the top gainer, rising 1.43%, followed by Nifty Consumer Durables, which climbed 0.91%, Nifty Media, up 0.64%, and Nifty Financial Services, which gained 0.42%.
However, metal stocks remained under pressure, with Nifty Metal declining 1.52%, making it the biggest sectoral loser in early trade.
Among Sensex stocks, HCLTech led the gains, rising 3.11%, followed by Bajaj Finserv (1.61%), Bajaj Finance (1.60%), Hindustan Unilever (1.55%), Tech Mahindra (1.46%) and TCS (1.44%).
Other gainers included Larsen & Toubro, Infosys, Bharti Airtel and HDFC Bank.
On the other hand, Axis Bank was the biggest laggard, falling 1.10%, followed by UltraTech Cement (-0.56%), Tata Steel (-0.48%), Power Grid (-0.42%), BEL (-0.40%) and Trent (-0.40%).
The broader market also remained firm. Nifty Midcap 50 rose 0.35%, Nifty Midcap 100 gained 0.31%, while Nifty Smallcap 100 advanced 0.42%, indicating continued buying interest beyond large-cap stocks.
While easing geopolitical risks and falling crude prices have supported the recent rally, analysts believe markets may not witness a one-way move.
Factors such as foreign investor activity, the strength of the global AI-led rally, domestic valuations and the progress of the monsoon will remain key triggers for Dalal Street in the coming weeks.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)
