Indian benchmark indices ended higher on Tuesday with strong participation from financial stocks, as reported by Goodreturns. The Sensex gained 394.50 points (0.54%) to settle at 73,918.76, while the Nifty 50 advanced 119.10 points (0.52%) to close at 23,242.10. Banking stocks led the recovery, with the Nifty PSU Bank Index rallying 3.62% and the Nifty Private Bank Index gaining 1.64%, indicating broad-based strength in the financial sector. According to Informist Media, the Nifty 50 closed at 23242.10, up 119.10 points or 0.5% higher, while the BSE Sensex closed at 73918.76, up 394.50 points or 0.5% higher. The broader market indices outperformed their benchmark peers throughout the session, with Nifty small-cap indices ending 1.4-1.7% higher and Nifty mid-cap indices closing 1.2-1.4% higher.
According to Goodreturns, market sentiment was supported by easing crude oil prices, strength in the Indian Rupee, and renewed buying interest in banking stocks. As reported by Informist Media, Brent crude oil prices slid 1.9% to around $92 per barrel following the announcement of a ceasefire in West Asia. Market experts noted that global cues and geopolitical developments are likely to remain key drivers in the near term. As stated by Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd., "Indian markets are expected to stabilise in the near term amid talks of a truce between Israel and Iran and easing crude oil prices, which have improved overall market sentiment. However, the absence of a definitive resolution to geopolitical tensions, coupled with concerns over inflation, commodity price volatility and monsoon trends, may keep investors cautious and limit upside." According to Informist Media, domestic market remain sensitive to developments in West Asia, with analysts noting that "hypothetically, assuming that crude oil prices will go down on the back of this deal between US and Iran, the outlook continues to remain positive."
On the sectoral front, buying was visible across most segments with Nifty PSU Bank emerging as the top performer with a gain of more than 3%, followed by Nifty Private Bank rising 1.58%, Nifty Realty advancing 1.66%, Nifty Auto gaining more than 1%, Nifty FMCG climbing 0.76%, Nifty Metal rising 0.56%, Nifty Pharma adding 0.62% and Nifty Oil and Gas moving up 0.33%. Only Nifty IT and Nifty Media closed in negative territory. From a technical perspective, according to Bajaj Broking Research, Nifty snapped its two sessions decline as it traded in a range with positive bias and closed higher by 0.5%. The index formed a bullish hammer like candle with a small real body and a long lower shadow, highlighting signs of reversal and buying demand emerging from the key support area of 23,000-23,200. The brokerage expects Index holding above Monday's low (23,070) will keep the pullback trend intact and open gradual upside towards 23,500-23,550 levels in the coming sessions. As reported by Informist Media, analysts see critical support for the 50-stock index at 23000-23100 in the near term, and resistance at 23600–23800.
Supporting market sentiment, Brent crude oil prices declined by more than 2% and were trading around USD 92 per barrel at the time of filing this report, as reported by Informist Media. The Indian rupee strengthened by 38 paise to ₹95.32 per US dollar after the Reserve Bank of India announced that fresh FCNR(B) deposits would be exempt from CRR and SLR requirements until September 30 to boost foreign currency inflows. According to HDFC Securities, the rupee appreciated as a recovery in risk-on sentiment was driven by a weaker greenback and declining crude oil prices amid hopes of easing geopolitical tensions. In the precious metals market, gold prices remained under pressure and were trading at ₹1,54,617 per 10 grams for 24 karat gold, while silver prices were largely flat at ₹2,46,618 per kilogram. Asian markets also witnessed positive momentum with Japan's Nikkei 225 index gaining 1.88%, Singapore's Straits Times rising 1.16%, Taiwan's Weighted Index surging 2.69%, and South Korea's KOSPI index jumping 7.56%, while Hong Kong's Hang Seng Index was the only major regional index to close lower, ending down 0.33%.
According to Informist Media, domestic benchmark stock indices are expected to be range-bound in the near term, susceptible to the news flow coming out of West Asia. The report notes that details on the guidelines by the Reserve Bank of India to promote foreign capital inflows also improved the sentiment in the market. Market experts emphasize that while the current truce between Israel and Iran provides some stability, the domestic market remain sensitive to developments in West Asia, with analysts warning that "if due to some reason, there is an escalation in the war...we may continue to witness a downward pressure on Indian equity markets." As stated by Vinod Nair, Head of Research at Geojit Investments Limited, "Domestic markets are witnessing a mild recovery after the recent sharp decline, supported by a pause in Iran-Israel tensions and softer crude prices. However, sentiment remains fragile, with continued FII outflows and higher bond yields highlighting persistent concerns around evolving global macro dynamics." He added that investors are closely watching upcoming US inflation data, which could influence expectations around the US Federal Reserve's policy path and global liquidity conditions.
