Benchmark equity indices BSE Sensex and NIFTY 50 rallied more than 1 per cent on Monday, supported by a steep fall in crude oil prices and strong global market cues amid improving sentiment over ongoing US-Iran negotiations. Market sentiment was further strengthened by the rupee’s appreciation against the US dollar and heavy buying in banking and financial sector stocks, according to traders.
The 30-share Sensex advanced 1,073.61 points, or 1.42 per cent, to close at 76,488.96. During intraday trade, the benchmark surged as much as 1,143.72 points, or 1.51 per cent, to touch 76,559.07. On the BSE, 2,785 stocks ended higher, 1,535 declined, while 211 remained unchanged. The broader Nifty climbed 312.40 points, or 1.32 per cent, to settle at 24,031.70.
“Investor sentiment was largely driven by optimism surrounding a possible US-Iran peace agreement, which led to a sharp correction in crude oil prices. Brent crude fell below the USD 100-per-barrel mark for the first time in more than two weeks and gradually moved toward the USD 95 level,” said Ajit Mishra.
Also read: Rupee rises 40 paise to 95.20 against US dollar in early trade
He added that strong performance by private banking heavyweights, encouraging earnings announcements and continued appreciation in the rupee against the US dollar also supported the market rally. Among the top gainers in the Sensex pack were Bajaj Finance, Larsen & Toubro, HDFC Bank, Eternal, Bajaj Finserv and Kotak Mahindra Bank.
On the other hand, Infosys, Tata Consultancy Services, Sun Pharmaceutical Industries and Hindustan Unilever ended among the laggards. Global benchmark Brent Crude plunged 5.52 per cent to USD 97.82 per barrel.
Meanwhile, the rupee strengthened by 35 paise to settle provisionally at 95.25 against the US dollar, extending gains for the third consecutive session.
The United States has reportedly made substantial progress in negotiations with Iran regarding the reopening of the Strait of Hormuz, though President Donald Trump remains cautious and unwilling to agree to an unfavourable deal, US Secretary of State Marco Rubio said on Monday.
“Markets witnessed strong positive momentum due to the decline in crude oil prices amid hopes of a possible US-Iran agreement. Global sentiment improved after reports of progress toward reopening the Strait of Hormuz, although uncertainty persists because of frequent changes in developments,” said Vinod Nair.
The BSE SmallCap Select index rose 1.18 per cent, while the MidCap Select index gained 0.92 per cent. Among sectoral indices, PSU Bank jumped 2.96 per cent, followed by Bankex at 2.27 per cent, Top 10 Banks at 2.19 per cent, Private Banks at 2.07 per cent, Financial Services at 2.06 per cent, Telecommunication at 1.89 per cent and Auto at 1.76 per cent.
FMCG and hospital stocks, however, underperformed the broader market. Across Asia, Japan’s Nikkei 225 and Shanghai’s SSE Composite Index ended with gains, while markets in South Korea and Hong Kong remained closed due to holidays.
European markets were trading in positive territory, while US markets had finished higher on Friday. According to exchange data, Foreign Institutional Investors (FIIs) sold equities worth Rs 4,440.47 crore on Friday. In the previous session, the Sensex had risen 231.99 points, or 0.31 per cent, to settle at 75,415.35, while the Nifty gained 64.60 points, or 0.27 per cent, to close at 23,719.30.
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