Indian equity benchmarks closed higher on Tuesday, with the Nifty 50 and BSE Sensex both gaining more than half a percent, supported by a moderation in crude oil prices and easing geopolitical tensions in West Asia. The recovery came after a recent sharp correction in the markets.
Benchmarks Performance
The Nifty 50 index settled at 23,242.10, up 119.10 points or 0.52 percent, while the BSE Sensex closed at 73,918.76, gaining 394.50 points or 0.54 percent. The positive close was attributed to broad-based buying across most sectors.
Market Sentiment
Market experts noted that domestic equities witnessed a mild recovery as investors took comfort from signs of easing tensions between Iran and Israel and a decline in crude oil prices. Vinod Nair, Head of Research at Geojit Investments Limited, said, "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. "Focus is now on the upcoming US inflation data, which will be key in shaping expectations on Fed policy and global liquidity, especially given resilient US economic data. In the near term, markets are likely to remain volatile and range-bound, with investors staying cautious until clearer global cues emerge, even as Q4FY26 earnings were slightly better while the outlook for Q1FY27 remains weak," Nair said.
Sectoral Performance
Buying was visible across most sectors. The Nifty PSU Bank index emerged as the top performer, gaining more than 3 percent. Nifty Private Bank rose 1.58 percent, while Nifty Realty advanced 1.66 percent. Nifty Auto gained more than 1 percent, Nifty FMCG climbed 0.76 percent, Nifty Metal rose 0.56 percent, Nifty Pharma added 0.62 percent, and Nifty Oil and Gas moved up 0.33 percent. Only Nifty IT and Nifty Media closed in negative territory.
Crude Oil and Currency
Supporting market sentiment, Brent crude oil prices declined by more than 2 percent and were trading around USD 92 per barrel at the time of filing this report. The Indian rupee also strengthened by 38 paise to Rs 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.
Dilip Parmar, Research Analyst at HDFC Securities, said the Indian 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. "Additionally, the resumption of inflows into the debt market, following recent RBI measures, provided further support."
Precious Metals and Asian Markets
In the precious metals market, gold prices remained under pressure and were trading at Rs 1,54,617 per 10 grams for 24 karat gold, while silver prices were largely flat at Rs 2,46,618 per kilogram. Asian markets also witnessed positive momentum. Japan's Nikkei 225 index gained 1.88 percent, Singapore's Straits Times rose 1.16 percent, Taiwan's Weighted Index surged 2.69 percent, and South Korea's KOSPI index jumped 7.56 percent. Hong Kong's Hang Seng Index was the only major regional index to close lower, ending down 0.33 percent.
