Sensex ends 736 points higher, Nifty above 23,800; IndiGo up 4%

The S&P BSE Sensex surged 736.38 points, or 0.97%, to settle at 76,264.33, while the NSE Nifty50 gained 231 points, or 0.98%, to close at 23,853.90. The rally was broad-based, with strong buying seen in auto, real estate, industrial and consumption-related stocks.

In Short

• US-Iran interim peace deal eased West Asia tensions
• Brent crude fell below $85, aiding Indian economy
• Realty, auto, and consumption stocks led market gains

Stock markets ended sharply higher on Monday, extending their rally as easing tensions in West Asia and a sharp fall in crude oil prices boosted investor confidence. The interim US-Iran peace agreement eased concerns over a prolonged conflict and helped crude prices fall below the crucial $85 per barrel mark, providing significant relief to the Indian economy.

The S&P BSE Sensex surged 736.38 points, or 0.97%, to settle at 76,264.33, while the NSE Nifty50 gained 231 points, or 0.98%, to close at 23,853.90. The rally was broad-based, with strong buying seen in auto, real estate, industrial and consumption-related stocks.

Brent crude dropped 5.14% to $82.84 per barrel, while US WTI crude fell 5.51% to $80.20 a barrel after the United States and Iran said they had reached an initial agreement to end the war and resume shipping through the Strait of Hormuz. The two countries are expected to sign a memorandum of understanding in Switzerland on Friday, according to Pakistani Prime Minister Shehbaz Sharif, whose country mediated the negotiations.

FALLING CRUDE OIL BRINGS RELIEF TO INDIA

Lower crude prices are a major positive for India, which imports more than 85% of its oil requirements. A sustained decline in oil prices could reduce inflationary pressure, improve the current account balance and support the rupee.

The Indian rupee strengthened for a second consecutive session and ended 0.4% higher at 94.71 against the US dollar, compared with its previous close of 95.11. During the day, the rupee touched 94.4625, its strongest level in five weeks.

Vinod Nair, Head of Research at Geojit Investments Limited, said the interim US-Iran peace agreement has significantly improved market sentiment.

"The interim US–Iran peace agreement has significantly improved investor sentiment, triggering a broad-based recovery across equity markets. With crude oil prices easing to below USD 85 per barrel, concerns around inflation have moderated, supporting a more stable interest rate outlook and improving earnings visibility for FY27," he said.

Nair added that as the risk-reward equation becomes more favourable, investors have moved towards growth-oriented sectors such as automobiles, industrials, capital goods and real estate, which are likely to benefit from an improving economic environment.

REALTY, AUTO AND CONSUMPTION STOCKS LEAD GAINS

Nifty Realty emerged as the top sectoral gainer, jumping 3.96%, followed by Nifty Auto, which climbed 2.60%. Nifty Metal rose 1.78%, Nifty Financial Services gained 1.39%, while Nifty IT added 0.98%.

Among Sensex stocks, Trent was the biggest gainer, rising 5.35%, followed by IndiGo, which jumped 3.62%. Bajaj Finserv gained 3.54%, UltraTech Cement rose 3.29%, Eternal advanced 3.26%, and Maruti climbed 3.06%.

Other notable gainers included M&M, up 3.01%, Larsen & Toubro, which gained 2.99%, Bajaj Finance, which rose 2.69%, and Titan, which added 2.10%.

On the losing side, NTPC was the biggest laggard, falling 1.64%, followed by ICICI Bank, down 0.94%. Asian Paints declined 0.58%, Hindustan Unilever slipped 0.52%, Sun Pharma fell 0.40%, and Tech Mahindra lost 0.28%.

BROADER MARKETS ALSO SEE STRONG BUYING

The rally was not limited to frontline stocks, indicating a strong improvement in risk appetite among investors.

The Nifty Midcap 50 index climbed 1.37%, while Nifty Midcap 100 and Nifty 500 gained 1.29% each. The Nifty Smallcap 100 rose 1.11%, reflecting broad-based participation across the market.

Meanwhile, volatility cooled, with India VIX falling 2.48% to 14.35, indicating easing nervousness among traders.

While the sharp rebound suggests that the worst of the West Asia-related panic has eased, investors will closely track whether the US-Iran peace agreement holds and whether crude oil remains at lower levels.

A stable rupee, lower inflation risks and reduced foreign investor selling could support markets in the near term. However, geopolitical developments, global interest rate expectations and corporate earnings will remain key factors determining the next move on Dalal Street.

(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.)

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