Stock markets opened higher on Wednesday, tracking gains across global equities as a sharp fall in crude oil prices offered some relief to investors amid signs of progress on reopening the Strait of Hormuz.
The BSE gained 292.31 points, or 0.38%, to 77,948.40, while the Nifty 50 rose 32.65 points, or 0.13%, to 24,367.20 around 9:55 am. The Sensex opened at 77,892.10, while the Nifty opened at 24,341.95.
The positive start came as oil prices eased after Iran resumed talks with Oman on managing the strategic waterway, raising hopes of a possible reopening of the Strait of Hormuz and a smoother flow of global oil supplies.
“Two factors which are positive for the market today” are the latest ceasefire developments between the US and Iran and initiatives to resume shipping through the Strait of Hormuz, said Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited. He noted that Brent crude had fallen to around $86.3 a barrel, adding that the decline was significant because elevated crude prices had been a major constraint on the Indian market.
Vijayakumar also pointed to a decline in US bond yields as another positive for equities globally. “The dip in bond yields in the US (10-year at 4.64%) is a mild positive for equity markets, globally,” he said.
The broader market also opened higher. Nifty 100 rose 0.21%, Nifty 200 gained 0.23% and Nifty 500 advanced 0.27%. The Nifty Midcap 50 and Nifty Midcap 100 gained 0.31% and 0.30%, respectively, while the Nifty Smallcap 100 rose 0.36%. India VIX fell 2.88% to 10.76.
Among sectoral indices, Nifty PSU Bank was the biggest gainer, rising 1.42%. Nifty Private Bank gained 0.81%, Nifty Financial Services 25/50 advanced 0.77% and Nifty MidSmall Financial Services rose 0.66%.
Nifty MidSmall IT & Telecom gained 0.58%, Nifty Media rose 0.54%, Nifty MidSmall Healthcare advanced 0.42%, Nifty Financial Services ex-Bank gained 0.63% and Nifty Pharma added 0.22%.
Nifty Auto was down 0.08%, while Nifty IT slipped 0.17% and Nifty Consumer Durables fell 0.22%.
Eternal led the Nifty 50 gainers, rising 1.78%, followed by Kotak Mahindra Bank at 1.41% and ICICI Bank at 1.28%. Ultratech Cement gained 1.26%, Bajaj Finserv rose 1.21% and NTPC added 1.19%.
SBI advanced 1.09%, Adani Ports gained 1.07%, ITC rose 1% and Hindustan Unilever added 0.98%.
Infosys was the biggest laggard, falling 1.12%. Bharti Airtel declined 0.79%, Larsen & Toubro fell 0.66%, BEL slipped 0.40% and Tech Mahindra declined 0.13%. Tata Steel was also down 0.08%.
Oil prices continued to ease, with WTI crude down 2.38% at $80.40 a barrel and Brent crude falling 2.47% to $86.39.
Vijayakumar, however, cautioned that the positive developments may not be enough to trigger a sharp rally in the Nifty.
“These are not good enough to trigger a sharp rally in the Nifty since many mega caps in the Nifty are technically weak,” he said.
Instead, he expects the broader market to remain the main driver of gains, supported by fundamentals and momentum. But he also flagged a key risk for investors: “It is also important to note that valuations in the broader market are getting stretched.”
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)