Sensex, Nifty Soar 3.5% as US-Iran Ceasefire Cools Oil, Lifts Markets

A key trigger for the rally was the sharp correction in crude oil prices, with Brent crude falling to around USD 94-95 per barrel after surging above USD 115 earlier.

Ponmudi R, CEO of Enrich Money, a SEBI-registered online trading and wealth tech firm, attributes this upward trajectory to the easing of global tensions.

"Indian equity markets are poised to open higher, supported by an improvement in global sentiment following a marked easing in geopolitical tensions. A temporary two-week ceasefire between the United States and Iran has helped restore risk appetite across global markets, reducing the immediate uncertainty that had weighed on equities," Ponmudi R said.

The ceasefire, announced by U.S. President Donald Trump, comes ahead of a previously indicated strike deadline. The agreement specifically links to the reopening of the Strait of Hormuz.

Sectorally, the rally was broad-based, led by rate-sensitive and cyclical sectors. The Nifty Realty index jumped over 5 percent, while auto, PSU banks and private banks surged 3-4 percent each.

Among the top gainers in Nifty, InterGlobe Aviation open up 9 percent, Larsen & Toubro up over 7 percent, while Shriram Finance, Adani Ports and Adani Enterprises gained between 5-6 percent. Financial stocks too saw strong recovery, with Bajaj Finance and Bajaj Finserv opening up over 4-5 percent, while Asian Paints and UltraTech Cement too posted positive gains.

Asian stock markets too spiked on Wednesday morning after the news of a two-week ceasefire between the United States and Iran. Oil prices fell sharply following the de-escalation of military tensions in the Middle East and the promised reopening of the Strait of Hormuz.

Japan's Nikkei 225 led the rally with a 5.28 per cent surge, up by 2,822.44 points, while South Korea's KOSPI rose 5.61 per cent or by 308.11 points.

Other regional indices, including the Hang Seng and Taiwan Weighted, saw gains of 3.04 per cent or 763.47 points and 3.72 per cent or 1234.69 points, respectively.

The ceasefire triggered a massive sell-off in the energy sector. Brent Crude plummeted 13.04 per cent to trade at USD 95.02 per barrel at 7:24 am IST, while US Crude Oil dropped 13.76 per cent to USD 97.41 at the same time.

On the other hand, Gold surged by 100.45 points or 2.13 per cent.

"Global markets have responded positively. Asian equities are trading higher, while a sharp pullback in crude oil prices--now below the $100 mark and trending toward the $91-96 range--offers a meaningful tailwind for India. Lower oil prices help ease inflationary pressures, support the current account, and improve the broader macro outlook," Ponmudi said.

Technical indicators for the Nifty 50 show signs of recovery after a recent correction. While the index opens at higher levels, Ponmudi noted that Nifty 50 is currently trading around the 23,100-23,150 zone, indicating an initial recovery after the recent correction. Immediate resistance is placed in the 23,300-23,400 range, and a sustained breakout above this zone can push the index towards 23,700-24,000 levels.

"On the downside, 23,000 now acts as immediate support, while the stronger demand zone remains at 22,700-22,600. Momentum indicators are showing early signs of improvement, although MACD continues to remain in negative territory, suggesting that strength is still building. Overall, the bias remains mildly positive, but confirmation of a stronger uptrend will depend on a decisive breakout above the resistance zone. Holding above 23,000 is critical to sustain the recovery," Ponmudi explained.

- ANI