Indian equity markets staged a strong recovery after ending a five-session losing streak, with both the Sensex and Nifty posting gains of around 1%. The rally was driven by a sharp decline in crude oil prices following signs of easing tensions between the U.S. and Iran. Lower oil prices are viewed as a positive development for India, as they help reduce inflationary pressure, improve the country’s import bill and support corporate profitability.
Banking, financial and auto stocks led the gains, while domestic institutional investors remained active buyers despite continued foreign fund outflows. Analysts expect the market to remain stock-specific in the coming sessions as investors closely track quarterly earnings, the U.S. Federal Reserve’s policy decision and global geopolitical developments. Market participants also believe a sustained decline in crude oil could provide further support to Indian equities over the near term.
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