Sensex, Nifty rally 1 pc in early trade as crude oil falls below $100 mark
Mumbai, May 25
Domestic equity markets traded higher on Monday after crude oil prices slipped below the $100-per-barrel mark for the first time in over two weeks amid hopes of a possible agreement to end the US-Iran conflict, with benchmark indices rising over 1 per cent each in early trade.
Sensex jumped as much as 874 points or 1.15 per cent to touch an intraday high of 76,289 in morning trade, while Nifty climbed 264 points or 1.11 per cent to 23,983.
Among sectoral indices, Nifty Auto led the gains, rising over 2 per cent, followed by Nifty PSU Bank and Nifty Private Bank, which advanced up to 1 per cent.
Nifty Oil & Gas, Nifty Realty, Nifty Consumer Durables, Nifty Cement and Nifty Chemicals indices traded in the green, with all sectoral indices remaining in positive territory.
In contrast, Hindalco Industries emerged as the top loser among Nifty stocks, falling nearly 2 per cent in early trade. ONGC, Max Healthcare, NTPC and Infosys traded lower, shedding up to 1 per cent.
Category-wise, smallcap indices led the gains in the broader market, with Nifty Smallcap 50 and Nifty Smallcap 100 rising over 1 per cent. Benchmark-linked broader indices, including Nifty 100, Nifty 200 and Nifty 500 gained around 1 per cent each.
In addition, US President Donald Trump has said that Washington and Tehran had largely negotiated a memorandum of understanding for a peace deal that could lead to the reopening of the Strait of Hormuz, a key route that previously handled nearly one-fifth of global oil and LNG shipments before the war.
Analysts said equities started the week on a positive note amid easing crude oil prices, better-than-expected March-quarter earnings, and improving currency stability.
They noted that crude prices had slipped below the $100-per-barrel mark on expectations of a possible US-Iran deal, which, if sustained, could emerge as a turning point for markets.
The experts highlighted the strong performance of digital platform companies during the fourth-quarter earnings season, saying markets are rewarding companies delivering healthy growth.
"The recent appreciation in the rupee from its lows is another encouraging sign, as currency stability could help revive foreign portfolio investor inflows," experts said.
They added that the market's resilience amid global uncertainties reflects the strength of the domestic economy and growing confidence among Indian investors.
Crude oil prices plunged sharply, with international benchmark Brent crude dropping 6.16 per cent to $97.16 a barrel, while US West Texas Intermediate (WTI) crude fell 6.5 per cent to $90.33 per barrel.
Asian equities witnessed a broad rally, with Japan's Nikkei and Taiwan's benchmark index surging nearly 3 per cent each, while Hong Kong's Hang Seng gained about 1 per cent.
The positive momentum followed a quiet but firm session on Wall Street, where the S&P 500 and Nasdaq ended higher by 0.37 per cent and 0.19 per cent, respectively.
— IANS
Reader Comments
Sensex up 874 points, Nifty near 24k, and crude below $100—good signs for retail investors like me. But I'm a bit cautious, these rallies can be volatile. Let's see if the rupee stability and FPI inflows sustain.
Impressive rally! The auto sector leading is interesting, maybe consumer confidence is picking up. But I wonder if the earnings growth is enough to justify these valuations? Good news for now, but long-term sustainability is key.
Great to see smallcaps and midcaps also participating. This broad-based rally shows genuine buying interest. However, I hope the government doesn't get complacent—we need to push for structural reforms and ease of doing business to keep this momentum.
The market reaction to falling crude is textbook economics. India benefits massively from lower oil prices. But I'm more interested in how the US-Iran talks progress—if they fail, we could see crude spike again. Let's hope diplomacy wins.
Happy to see the markets green today. My mutual fund portfolio has been doing well lately. But one concern—Hindalco falling despite the rally shows that not all sectors are benefiting equally. Need to watch commodity stocks closely! 🧐
M Michael C