Indian Markets Rally on US-Iran Ceasefire Relief
Indian Markets Rally on US-Iran Ceasefire Relief
Indian indices surge as US-Iran ceasefire relief boosts sentiment; Sensex, Nifty jump, oil falls, and market cap soars while FPIs stay cautious.
Mumbai's benchmark indices surged on relief over a US-Iran ceasefire, delivering one of the sharpest single-day gains in years. The Sensex jumped about 4%, closing at 77,562.90, the biggest daily gain since early 2021, while the Nifty rose 3.8% to 23,997.35, the strongest rally in 11 months. The rally added ₹16.1 lakh crore to the market cap of BSE-listed companies.
Oil prices tumbled around 15% as the ceasefire reduces geopolitical risk, easing inflation concerns and providing some breathing room for growth. The rupee strengthened and government bond yields eased, with gold and silver also higher as safe-haven demand shifted.
Foreign portfolio investors remained net sellers on the day, pulling out ₹2,811.97 crore from Indian equities, contributing to a total April selling tally of ₹48,317 crore. Domestic institutions, meanwhile, bought about ₹4,168.17 crore, offering a counterbalance to the foreign outflow and underpinning the broad-based move higher.
Analysts said the relief rally reflects investors shifting from risk-off to risk-on trading, with sentiment improving on hopes that the war could come to a nearer end and that a formal peace agreement might be reached sooner rather than later. Nonetheless, they cautioned that the market could remain sensitive to new geopolitical developments and the pace of any formal accord.
The two-week pause in West Asia hostilities and potential reopening of key shipping routes, such as the Strait of Hormuz, likely contributed to the broader optimistic mood, even as traders watch for further clarity on inflation and earnings trajectories.
