Mumbai, India – Indian stock markets experienced a significant rebound in early trade on Monday, with benchmark indices Sensex and Nifty showing substantial gains. The positive sentiment was largely driven by a sharp decline in global crude oil prices, attributed to easing tensions in West Asia.
According to details received by The Chenab Times, the 30-share BSE Sensex jumped 566 points to reach 76,608.66 in early trading. Concurrently, the 50-share NSE Nifty surged by 153.60 points, trading at 23,923.30. This upturn marks a recovery from Friday’s performance, where both indices had closed lower.
Market analysts pointed to the reduction in crude oil prices as a primary catalyst for the market’s revival. The global oil benchmark, Brent crude, tanked approximately 4 percent, settling at USD 92.84 per barrel. This drop is seen as a significant tailwind for India, which relies heavily on oil imports, promising lower inflation expectations, an improved current account outlook, and reduced pressure on the Indian Rupee.
Rajesh Palviya, Head of Research at Axis Direct, commented that market sentiment improved substantially over the weekend following a pause in military action between the US and Iran, thereby alleviating fears of immediate supply disruptions. The significant correction in Brent crude prices is expected to have a positive ripple effect across the Indian economy.
Among the major gainers in the Sensex pack were InterGlobe Aviation, Infosys, Eternal, Asian Paints, and Bajaj Finance. Conversely, Bharti Airtel and ICICI Bank were among the laggards. The broader market sentiment appears to favour sectors that benefit from lower energy costs.
VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, highlighted the positive impact of Brent crude’s sharp dip from USD 102 just four days prior to around USD 93. He noted that if the de-escalation of the West Asia conflict persists and crude prices continue to fall, it could sustain a mild rally in the market.
The performance of foreign institutional investors (FIIs) on Friday saw them offloading equities worth Rs 3,892.77 crore, according to exchange data. Despite this outflow, the domestic market showed resilience, driven by the optimistic outlook on crude oil prices.
In global markets, Asian trading showed mixed signals. South Korea’s KOSPI traded lower, while Japan’s Nikkei 225, Shanghai’s SSE Composite, and Hong Kong’s Hang Seng indices were trading higher. US markets had closed mostly higher in their previous trading session.
The context of this rebound is crucial, as on Friday, the Sensex had declined by 331.62 points, or 0.43 percent, to close at 76,059.77. The Nifty had also dipped by 102.15 points, or 0.43 percent, ending at 23,767.45. The current surge suggests a potential shift in market dynamics, contingent on the stability of crude oil prices and geopolitical developments in West Asia.
The government’s focus on economic stability and managing inflation, particularly through controlling import costs, is closely linked to global energy market fluctuations. A sustained drop in crude oil prices could provide significant relief to consumers and businesses alike, bolstering economic growth prospects for India.
The market’s reaction underscores the sensitivity of India’s financial landscape to international commodity prices and geopolitical events. Investors will be closely monitoring further developments in West Asia and their impact on global oil supplies and prices in the coming days, as these factors are expected to continue shaping market trends.
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The Chenab Times News Desk
