Ceasefire calm ignites 4% surge across mkts

News Service mumbai

A pause in conflict has delivered a surge of confidence. As a fragile two-week ceasefire between the United States and Iran steadied nerves across West Asia, India’s equity markets responded with rare force, rising nearly 4% on Wednesday in a synchronised global rally powered by falling oil prices.

The BSE Sensex climbed 3.95% to 77,562.90, after touching an intra-day high of 77,635.54, while the NSE Nifty 50 advanced 3.78% to close at 23,997.35, briefly reclaiming the 24,000 threshold. The advance marked a fifth consecutive session of gains, driven less by exuberance than by relief.

That relief was anchored in crude. Brent crude oil fell sharply by 13.89% to $94.09 a barrel after the reopening of the Strait of Hormuz restored a critical supply route. For India, heavily dependent on imported energy, the implications were immediate: softer inflation risks, a firmer rupee, and easing pressure on bond yields.

“The improvement in sentiment is tangible,” said Vinod Nair of Geojit Investments, pointing to stable policy expectations from the Reserve Bank of India and a more balanced outlook for FY27 earnings. Investment strategist Dr V.K. Vijayakumar added that the ceasefire had “dramatically altered” the near-term trajectory, potentially drawing foreign investors back as currency stability improves.

Markets reflected this shift. InterGlobe Aviation surged 8.22%, while Larsen & Toubro, Bajaj Finance, Mahindra & Mahindra and Axis Bank led gains across cyclicals. Defensives such as Sun Pharmaceutical Industries and Power Grid Corporation of India lagged.

The optimism was global. Japan’s Nikkei rose 5.39%, South Korea’s Kospi 6.87%, with European markets also advancing strongly.

Yet the rally carries a note of restraint. Fourth-quarter earnings are expected to be subdued, and the ceasefire remains tentative. Still, with valuations reasonable and oil retreating below $100, investors appear willing—for now—to believe in stability.