Sensex Surges 400 Points, Nifty Above 24,000 on Falling Oil Prices

Markets opens on strong note as falling crude, global optimism lift sentiment, Sensex up 400 points, Nifty opens above 24,000

Mumbai, June 25

Sensex opened with a gap-up at 77,391.07, and was trading at 77,409.75, up 418.53 points or 0.54 per cent, while Nifty was trading at 24,157.75, up 136.10 points or 0.57 per cent at the time of writing.

Sectoraly, Nifty Auto, Realty and Cement led gains, surging over a per cent. On BSE, IndiGO, Maruti, M&M, SBI, Hindustan Unilever, Trent, ICICI Bank, Adani Ports, Reliance, Kotak Bank, Axis Bank, TCS, LT among others gained, while Power Grid, Eternal, BEL, Infosys, Titan among others were top losers. Adding to the supportive backdrop, Brent crude slipped near USD 73 per barrel -- its lowest level in months -- offering a tailwind for India's macro stability and inflation outlook.

Market experts attributed the rally to improving global risk sentiment, falling crude oil prices and favourable implications for India's macroeconomic stability. Ajay Bagga, Market and Banking Expert, said global equities had regained strong momentum after fresh confidence returned to the AI investment theme. "Global equities have caught a massive second wind this morning. The tech-led anxiety that briefly weighed on Wall Street has been entirely dismantled by a blowout sales outlook from memory-chip giant Micron, alongside ambitious data-centre targets from Qualcomm. These stellar updates have pumped fresh confidence back into the AI trade, triggering an explosive rally across Asia--with South Korea's KOSPI surging over 5% and Japan's Nikkei up over 2%," Bagga said.

He added that the sharp correction in crude oil prices was further supporting risk assets globally."Crucially, Brent crude has tumbled toward $73 a barrel as tankers finally begin exiting the Strait of Hormuz following structural progress on a U.S.-Iran peace deal. While a robust U.S. dollar and upcoming PCE inflation data keep central banks on watch, the combination of a secular tech boom and deflating energy costs is giving global bulls complete control," he said.

Sectorally, oil marketing companies, aviation stocks, paint manufacturers and other crude-sensitive sectors arte up getting the benefit from the decline in crude prices. Information technology shares are also up following the global technology-led rally.

VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said the fall in crude oil prices was emerging as a major positive for the Indian economy and equity markets.

"There are significant trends that will influence the market in the near-term. The biggest positive for India is Brent crude falling to below $ 73 level. With this, the CAD and BoP deficits which were threatening India's macro stability have ceased to be serious concerns. This will have positive implications for India's GDP growth and inflation in FY27 and consequently for the market, too," Vijayakumar said.

"From the market perspective, this is a strong bullish factor," he added.

However, Vijayakumar cautioned that concerns over a deficient monsoon continue to remain a key risk factor for certain segments of the economy. "The negative factor continues to be the deficient monsoon. The sectors that will be negatively impacted by deficient monsoon like tractors and agro-machinery, fertilisers and crop-protection products, FMCG and entry level two-wheelers dependent significantly on rural demand, will be impacted by deficient monsoon," he said.

He noted that urban consumption-driven sectors are likely to remain resilient despite weather-related concerns."On the contrary, premium consumption including FMCG whose demand primarily comes from urban areas, luxury consumption including high-priced automobiles, IT and export-oriented segments will not be impacted by deficient monsoon. Pharmaceuticals with inelastic demand is, normally, an out-performer during deficient monsoons," Vijayakumar added.

He also highlighted continued volatility in Asian markets, particularly South Korea, driven by investor enthusiasm for semiconductor companies.

"The excessive volatility in the South Korean market continues with 10% crash in one day and 5% up move on another day. The huge profitability of the semiconductor companies is attracting buyers on declines despite the concentration risks in this investment. FII flows will be influenced by this trend," he said.

Market analyst Vipin Dixena noted, "On the index front, the important near-term level remains 24,090, which now acts as support, while 24,200 is the first resistance; a sustained move above that zone can open room for further upside, but failure to hold 24,090 may invite profit-booking after the gap-up."

Abhishek Kumar, SEBI RIA, founder of SahajMoney, added "While Wall Street provided mixed signals overnight, the successful reclamation of the 24,000 support level in the previous session has provided a solid base for the current momentum. Oil-sensitive sectors and Tech are leading the initial gains. Outlook remains constructive for the session as indices look to consolidate above the 24,100 mark."

Going forward, foreign institutional investor flows, movement in crude oil prices, monsoon progress and key U.S. inflation data will give further direction to the markets. Experts believe sustained strength in global technology stocks and lower energy costs could continue to support risk appetite in the near term.

— ANI