Indian stock markets rebounded on Wednesday, with benchmark indices Sensex and Nifty snapping a four-session losing streak as the rupee recovered from all-time low levels and oil prices cooled down slightly. According to reports from The Economic Times, Sensex gained around 120 points to 74,679, while Nifty 50 rose 59 points to 23,438 on Wednesday. The optimism was broad-based, with Nifty Midcap 100 and Nifty Smallcap 100 indices gaining nearly 0.7% each. This recovery came despite ongoing geopolitical tensions and fragile ceasefire conditions between Iran and the US.
Asian Paints shares emerged as the top gainer on the Sensex, jumping nearly 4% in the morning. According to The Economic Times, Tata Steel, Adani Ports, HCLTech, Kotak Mahindra Bank, L&T, Titan, BEL and HDFC Bank shares followed, rising up to 1%. However, Power Grid, Eternal, Bajaj Finance and a few other stocks declined up to 1%. Sectorally, Nifty Metal gained more than 1% to emerge as the top gainer, while Nifty Consumer Durables slipped into the red. Around 1,858 stocks advanced on NSE, while 692 declined and 87 remained unchanged.
The rupee's recovery provided significant support to market sentiment, with India VIX, which measures volatility in markets, falling nearly 2% to 18.98 on Wednesday morning. As reported by The Economic Times, Jateen Trivedi, VP Research Analyst at LKP Securities, expects the rupee to trade within a range of 95.25–96.00, with volatility likely to remain elevated. Oil prices slightly declined but comfortably remained above the crucial $100 per barrel mark, with Brent crude falling 1% to $107 per barrel and WTI Crude declining over 1% to $101 per barrel. These movements came amid US military blockade over the Strait of Hormuz, which handles over 20% of the world's daily oil and gas shipments.
Despite the market recovery, geopolitical tensions continue to pose challenges, with US President Donald Trump growing increasingly frustrated with Iranian leaders over war negotiations. According to reports from The Economic Times, Trump is more seriously considering resuming major combat operations that would make the ceasefire redundant. VK Vijayakumar, Chief Investment Strategist at Geojit Investments, noted that the market has been discounting an early resolution to the West Asia crisis and decline in crude prices, but these appear difficult now. He warned that the downside risk to India's growth and upside risk to inflation has increased, with negative implications for markets.
Foreign investors continued their selling streak, with net selling shares worth ₹1,959 crore on Dalal Street on Monday, marking the sixth consecutive session of selling by foreign investors. As reported by The Economic Times, this persistent FII selling dampens market sentiment, with analysts suggesting that FIIs are likely to continue in sell mode due to AI trade concerns. The analyst recommends remaining in cash until clarity emerges on crude prices, with pharmaceuticals appearing as the safe sector and banking stocks potentially attractive on declines.
