The Indian stock market opened higher on Wednesday, with the BSE Sensex climbing 236.01 points or 0.30% to 77,892.10 and the NSE Nifty starting the session with a gain of 7.40 points or 0.03% at 24,341.95. According to Zee News, the positive opening was supported by a sharp decline in crude oil prices, with Brent crude trading around $86 per barrel, down more than 2%. The recovery built on Tuesday's strong performance where the Sensex bounced back during the fag-end of trading and was up 286.98 points to settle at 77,656.09, while the Nifty ended higher by 115.50 points at 24,334.55 on fag-end buying. Tuesday's session saw the Nifty recover more than 200 points from its intraday low of 24,115.45, forming a bullish engulfing candlestick pattern that completely engulfed the price action of the previous three trading sessions.
The market recovery was significantly boosted by a sharp decline in crude oil prices, with Brent crude easing to around $86 per barrel, down more than 2% as concerns over supply disruptions continue to recede. According to Zee News, the decline was supported by reports of another ceasefire between the US and Iran and efforts to resume shipping through the Strait of Hormuz. As per Enrich Money's Ponmudi R, "Crude oil has emerged as the key positive catalyst. WTI has fallen more than 6 per cent over the past two sessions to trade in the $80–81-per-barrel range. For domestic markets, the retreat in oil prices provides a meaningful near-term tailwind after crude-driven inflation worries dominated sentiment over the past several weeks." While tensions between the U.S. and Iran remain elevated, recent developments surrounding discussions involving Iran and Oman over the Strait of Hormuz have raised cautious optimism that supply-disruption risks could ease. US West Texas Intermediate (WTI) crude was seen at nearly $80.10 per barrel, while a decline in US bond yields, with the 10-year Treasury yield at 4.64%, also offered support to global equities.
In early trade, sectoral performance was mixed with PSU banking shares leading gains, as reported by Zee News. Nifty PSU Bank rose 1.4%, followed by Nifty Realty, up 0.66% and Nifty MidSmall Financial Services which gained 0.48%. Nifty Private Bank also rose 0.46%, while Nifty Metal fell 0.51%, which was the top laggard. Other sectors showed mixed performance with Nifty Auto declining, Nifty Healthcare Index, Nifty FMCG and Nifty Consumer Durables slipping up to 0.26%. Among the 30 Sensex firms, ICICI Bank, State Bank of India, Kotak Mahindra Bank, Eternal, Bajaj Finserv and Asian Paints were among the major winners in Wednesday's early trade. Infosys, Bharti Airtel, Larsen & Toubro and Bharat Electronics were among the laggards. Among the early gainers, ICICI Bank rose 1.29% to ₹1,441.10, opening at ₹1,423.10 against a previous close of ₹1,422.70, leading the banking sector gains.
With Wednesday's opening, the Nifty 50 formed a sizable bullish candle that completely engulfed the price action of the previous three trading sessions, resulting in the formation of a bullish engulfing candlestick pattern. As per Dalal Street Investment Journal, the index moved above its 20, 50, and 100 EMAs and closed above the 38.2% Fibonacci retracement level of the decline witnessed over the previous 12 trading sessions. The immediate resistance for the index is placed in the 24,400–24,550 zone, with key resistance at 24,400–24,550 and support at 24,200–24,100. For Bank Nifty, which closed at 57,514.20 on Tuesday, resistance lies at 57,700–58,000 while support is placed at 57,300–57,000. As per Gaurav Udani, Founder of ThinCredBlu Securities, "The recovery suggests some buying interest returning to the market. With the broader market still volatile, traders can consider a buy-on-dips strategy, preferably near key support levels rather than chasing the gap-up opening." According to Zee News, the experts noted that the rise seen in the previous session is expected to mature around the 24,400 level with the Nifty potentially extending gains towards 24,550 or 24,820, while on the downside, 24,220 is seen as a key marker.
Foreign Institutional Investors (FIIs) bought equities worth ₹1,593.53 crore on Tuesday (August 25), according to exchange data, while domestic institutional investors (DIIs) added ₹230 crore to the market, as per The Hindu BusinessLine. Looking ahead, markets face a packed global calendar with Nvidia's quarterly earnings on Wednesday being closely watched as a bellwether for the global AI investment cycle, along with US consumer confidence data, Fed meeting minutes, and further developments on US-Iran tensions and crude oil prices. Rollover data from the August expiry showed market-wide rollovers at 91%, above the three-month average of 90%, with Nifty rollovers at 78% against a three-month average of 74%. FPI net short positions in index futures stood at approximately $3.14 billion, down from $3.45 billion at the previous expiry, raising the possibility of short covering in coming sessions. In Asian markets, sentiment remained cautious after US index futures edged lower with investors awaiting Nvidia's earnings announcement, while Asian markets were trading mixed despite a decline in crude oil prices.
