Equity benchmark indices Sensex and Nifty rebounded in early trade on Tuesday, in-line with a rally in global markets, after US President Donald Trump announced a temporary halt on strikes targeting Iranian energy infrastructure.
The 30-share BSE Sensex jumped 1,516 points to 74,212.47 in early trade. The 50-share NSE Nifty surged 386.95 points to 22,899.60.
From the 30-Sensex firms, InterGlobe Aviation, Asian Paints, Eternal, Adani Ports, Trent and Larsen & Toubro were the biggest winners.
Power Grid emerged as the only laggard from the pack.
Trump said on social media that he has extended the deadline for Iran to reopen the Strait of Hormuz, the strategically-located shipping lane between the Persian Gulf and the Gulf of Oman, and that he will hold off strikes against Iranian energy sites for five days.
Asian markets rebounded, with South Korea’s benchmark Kospi, Japan’s Nikkei 225 index, Shanghai’s SSE Composite index and Hong Kong’s Hang Seng index trading in positive territory.
The US market ended higher on Monday.
“The positive momentum appears largely driven by a sudden shift in global sentiment following signs of potential de-escalation in the ongoing Middle East conflict. Global markets reacted positively after Donald Trump indicated that the United States had engaged in discussions with Iran and announced a temporary halt on strikes targeting Iranian energy infrastructure.
“This development has raised expectations that the conflict-which had significantly elevated crude oil prices and triggered recessionary fears-may be approaching a phase of de-escalation,” Hariprasad K, Research Analyst and Founder, Livelong Wealth, said.
However, the situation remains fluid, he said.
“Asian markets have opened on a strong footing, supported by a pullback in crude oil prices. The cooling in oil has eased immediate inflation concerns and improved risk appetite across global equities,” Hariprasad added.
Brent crude, the global oil benchmark, traded 4.16 per cent higher at USD 104.1 per barrel.
“The easing in oil has been triggered by a temporary de-escalation in geopolitical tensions, after Donald Trump postponed the planned strikes on Iran’s power infrastructure for five days. This signals ongoing diplomatic engagement and has reduced immediate fears of a full-scale escalation, bringing short-term relief to global markets,” Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm, said.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 10,414.23 crore on Monday, according to exchange data. Domestic Institutional Investors (DIIs), however, bought stocks worth Rs 12,033.97 crore.
On Monday, the 30-share BSE Sensex dived 1,836.57 points or 2.46 per cent to settle at 72,696.39. The Nifty tanked 601.85 points or 2.60 per cent to end at 22,512.65.
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