Indian equity markets advanced on Monday as oil prices softened amid reports that regional mediators are pushing for a ceasefire between the US and Iran.
The benchmark Sensex ended at 74,107, up 787 points, or 1.07 per cent. The Nifty closed at 22,968, gaining 255 points, or 1.1 per cent. Both indices fell over 0.7 per cent intraday. The total market capitalisation (mcap) of BSE-listed firms rose by ₹5 trillion to ₹428 trillion.
Gains were led by banking stocks, which rallied following positive quarterly business updates ahead of the earnings season.
Brent crude oil fell 1 per cent to $105.57 per barrel. Media reports indicated that Pakistan, Egypt, and Turkey are working to broker a potential 45-day ceasefire between the US and Iran. However, hostilities persisted in West Asia, with Israel, Kuwait, and the UAE reporting Iranian attacks. Israel also struck an Iranian petrochemical facility that accounts for roughly half of the country’s petrochemical output.
Over the weekend, US President Donald Trump warned that Iran’s power plants could be targeted if the Strait of Hormuz is not reopened by Tuesday night. The threat is part of a series of ultimatums issued since March 21, aimed at forcing Iran to reopen the strategic waterway, which handles about a fifth of global oil trade. The disruption has triggered an energy crisis, pushing oil prices up by 43 per cent.
Market participants attributed Monday’s rebound partly to value-buying in oversold sectors.
“Crude oil prices softened marginally on ceasefire hopes, while encouraging provisional banking data supported interest in rate-sensitive segments. However, risk appetite remains cautious amid persistent inflation concerns and potential disruptions to global trade. With the Reserve Bank of India (RBI) policy, US Consumer Price Index (CPI) data, crude trajectory, and geopolitical developments all in focus this week, markets are likely to remain headline-driven. That said, the deep correction in the broader market offers meaningful upside if a credible ceasefire materialises,” said Vinod Nair, head of research at Geojit Investments.
Chokkalingam G, founder of Equinomics, said investors are betting that oil flows through the Strait of Hormuz could resume even if the conflict drags on.
“If shipping resumes through Hormuz, it could ease oil prices and bond yields. It is rare to see such a broad coalition of countries pushing for a resolution on a specific issue during an ongoing conflict,” he said.
Market breadth remained positive, with 3,193 stocks advancing and 1,173 declining.
Foreign portfolio investors (FPIs) were net sellers of ₹8,167 crore, while domestic institutional investors (DIIs) were net buyers of ₹8,089 crore.
Among stocks, HDFC Bank rose 2.7 per cent and was the biggest contributor to Sensex gains, followed by Axis Bank, which climbed 4 per cent.
