Markets staged a sharp recovery on Friday morning after Thursday’s bruising sell-off, with the surging 831.08 points (1.12 per cent) to 75,038.32 and the Nifty 50 gaining 261.50 points (1.14 per cent) to 23,263.65 by 09.23 am.
The Sensex had closed the previous session at 74,207.24, opening today at 74,559.38, while the had ended Thursday at 23,002.15, opening at 23,110.15. Thursday’s fall — a 775.65-point (3.26 per cent) drop in the Nifty — was its steepest single-session decline since April 7, 2025.
The trigger for the reversal was a combination of geopolitical signals and a retreat in crude oil. Israeli Prime Minister Netanyahu stated that Israel would not strike Iranian oil and gas infrastructure again and was supporting US efforts to reopen the Strait of Hormuz, adding that the war could end “sooner than expected.” His remarks sent Brent crude tumbling from a peak of $118 per barrel to around $106.
US Treasury Secretary Scott Bessent separately signalled that Washington may lift sanctions on Iranian crude, further easing supply concerns. The US, UK, Canada, France, Germany, and Japan issued a joint statement affirming readiness to ensure safe passage through the Strait of Hormuz.
“…the market construct is ripe for a bounce back today. Beaten-down financials and autos are set for a bounce back,” said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, adding that the HDFC Bank situation was “likely to be a storm in a tea cup.”
Sectoral moves: IT and metals lead gains, financials mixed
On the Nifty 50, IT majors led the charge, with Tech Mahindra (TECHM) rising 2.85 per cent to ₹1,378.80 from a previous close of ₹1,340.60, and Infosys (INFY) gaining 2.22 per cent to ₹1,247.90 from ₹1,220.80. In metals, Tata Steel (TATASTEEL) climbed 2.62 per cent to ₹195.50 from ₹190.51, supported by the easing of risk sentiment. The public sector banking space also firmed up, with SBI (SBIN) rising 2.44 per cent to ₹1,074.50 from ₹1,048.90. In the energy sector, Coal India (COALINDIA) gained 2.23 per cent to ₹464.35 from ₹454.20.
On the losing side, HDFC Bank (HDFCBANK) remained under pressure, slipping 0.93 per cent to ₹790.75 from a previous close of ₹798.20. Weakness in its US-listed ADRs has reflected investor concerns following recent governance developments, with the unusual discount of ADRs to domestic shares underscoring a shift in sentiment. HDFC Life (HDFCLIFE) fell 0.58 per cent to ₹629.85 from ₹633.50, while Bajaj Finance (BAJFINANCE) edged down 0.25 per cent to ₹830.10 from ₹832.20 — keeping the broader financial sector cautious despite the market-wide rally. In metals, Hindalco (HINDALCO) declined 0.67 per cent to ₹891.00 from ₹897.05.
“…India VIX continues to trade above 22 levels, reflecting persistent uncertainty linked to geopolitical developments. While volatility may remain high in the near term, any signs of de-escalation could trigger a sharp decline in VIX, leading to rapid compression in option premiums,” said Hariprasad K, SEBI-registered Research Analyst and Founder of Livelong Wealth.
Institutional flows and currency remain a concern
Foreign Institutional Investors extended their selling streak on Thursday, offloading equities worth ₹7,558 crore in a clear risk-off move, while Domestic Institutional Investors cushioned the fall by purchasing ₹3,864 crore worth of equities. The Indian rupee remains under pressure amid a strengthening dollar and elevated crude prices, with sustained FII outflows adding to currency headwinds.
Gold prices have also come under pressure, declining sharply and heading for one of their worst weeks, as the Federal Reserve maintained a hawkish stance on interest rates. A stronger dollar and expectations of a prolonged higher-rate environment have reduced appetite for the metal, with the Fed’s position now seen as a more dominant driver than geopolitical risks.
Technically, Nifty faces immediate resistance at 23,200–23,250, with support at 22,850–22,900. The RSI on the index stood at 29.74 after Thursday’s session, signalling oversold conditions. Bank Nifty resistance is seen at 53,800–54,000, with support at 53,100–53,200 and an RSI of 28.75 — also in deeply oversold territory.
“…the Nifty found support at the lower end of the 22,923–23,207 band and is now poised to rebound toward the upper end today,” said Devarsh Vakil, Head of Prime Research at HDFC Securities, noting that Thursday’s session was the beginning of what could be “the end of war.”
Analysts caution that the recovery remains fragile. Ponmudi R, CEO of Enrich Money, a SEBI-registered online trading and wealth tech firm, noted that the market remains “highly event-driven,” with crude oil prices, geopolitical developments, currency movements, and institutional flows set to shape near-term direction. For investors, the message from the Street is uniform: “…focus on accumulating fundamentally strong stocks on deeper declines, rather than attempting to chase short-term pullbacks,” as Hitesh Tailor of Choice Equity Broking put it.