After weeks of sustained selling pressure, Indian equities staged a strong rebound in Wednesday’s session, April 8, as easing geopolitical tensions—following a two-week ceasefire agreement between the US and Iran—helped calm fears of energy-driven inflation.
The pause in hostilities led to a decline in energy prices, while a softer US dollar further supported sentiment. Benchmark indices ended sharply higher, with the Nifty 50 and Sensex gaining 3.75% and 3.95%, respectively. The broader market mirrored the uptrend, as both the Nifty Midcap 100 and Nifty Smallcap 100 indices advanced over 4%.
All sectoral indices ended in the green, with Nifty Realty topping the charts by surging 6.75%, while Nifty Auto also posted a similar gain of 6.7%. Other indices, including Nifty Oil & Gas, Nifty Chemicals, Nifty Media, and Nifty Metal, all closed with gains of over 2.5%.
The month-long tensions in West Asia, which rattled equity markets across the world, saw some relief as both the US and Iran agreed to halt missile attacks for two weeks and restart negotiations. Earlier, amid ongoing nuclear talks with Iran, the US and Israel jointly carried out strikes on February 28, triggering a sharp surge in crude and gas prices.
President Donald Trump agreed to suspend attacks on Iran for two weeks in exchange for Tehran allowing safe passage through the Strait of Hormuz. Trump said the ceasefire was subject to Iran agreeing to a complete, immediate, and safe reopening of the Strait. The US has also received a 10-point proposal from Iran, which he described as a workable basis for negotiations.
Meanwhile, the Reserve Bank of India kept interest rates unchanged, striking a cautious tone as it monitors the impact of rising oil prices on the economy and pledges to curb any excessive currency volatility.
(more to come)