The Indian stock market continued its upward momentum for the third consecutive day on Tuesday. Domestic markets rallied, buoyed by positive shifts in global markets following a historic peace agreement between the US and Iran, alongside a drop in crude oil prices. Driven by this impressive surge, the Bombay Stock Exchange (BSE) benchmark Sensex and the National Stock Exchange (NSE) Nifty closed with significant gains.
Indices make strong gains
At the close of trading, the 30-share Sensex settled at 76,808.48, up by 544.15 points or 0.71 percent. During the session, the index had surged by as much as 582.41 points, touching a high of 76,846.74. Meanwhile, the 50-share Nifty closed at 23,989.15, registering a gain of 135.25 points or 0.57 percent. Market experts note that the Nifty is once again on the verge of breaching the psychological 24,000 mark. Notably, the markets had also witnessed a significant rally on Monday, with the Sensex gaining 736 points and the Nifty rising by 231 points.
Impact of the Peace Agreement and Cheaper Crude Oil
The primary driver behind this market rally is the peace agreement reached between the US and Iran. On Sunday, the two nations agreed to reopen the Strait of Hormuz—one of the world’s most critical energy supply routes. Following this news, crude oil prices in the international market softened; the global oil benchmark, Brent crude, fell by 2 percent to $81.45 per barrel. A decline in crude oil prices offers significant relief to emerging economies like India, as it reduces the national import bill and helps curb inflation.
Stocks Seeing the Most Activity
Among the top 30 Sensex companies, strong buying was witnessed today in shares from the IT, banking, and FMCG sectors. Top gainers included HCL Tech, Bajaj Finserv, NTPC, Hindustan Unilever, TCS, and Bajaj Finance.
However, amidst this broad-based rally, shares of some companies also declined. Due to profit-booking, shares of InterGlobe Aviation (IndiGo), UltraTech Cement, Maruti Suzuki, and Tata Steel ended in the red.
Boost from the Return of Foreign Investors
According to market experts, investor confidence has been bolstered by a shift in the stance of Foreign Institutional Investors (FIIs). After a long hiatus, foreign investors have returned as buyers in the Indian stock market. Exchange data shows that foreign investors made net purchases of shares worth ₹200.05 crore on Monday.
Experts believe that as long as crude oil prices remain under control and global geopolitical tensions stay subdued, this phase of recovery in the Indian stock market is likely to continue.
