The Indian stock market traded sharply higher on Monday, with Nifty rallying 1.6% and Sensex rising 0.7%, as US President Donald Trump said talks with Iran would take place today, triggering a sharp fall in oil prices and boosting investor sentiment on Dalal Street.
Sensex rose over 544 points to close above 78,639, while Nifty 50 rose around 391 points to end the session at 24,774. The sharp gains added nearly Rs 5 lakh crore to the total market capitalisation of all companies listed on BSE, pulling it up to Rs 491 lakh crore.
Here's how analysts read the market pulse
The decline in crude oil prices, driven by expectations of renewed dialogue between the US and Iran, provided relief to markets by easing concerns over inflation and corporate earnings, said Vinod Nair, Head of Research at Geojit Investments. He added that the market sentiment was further supported by a rebound in FII inflows and a strengthening rupee, although elevated US bond yields remain a key risk to the sustainability of foreign flows into emerging markets. Most sectors ended in positive territory, led by IT and FMCG, while pharma witnessed profit booking following its recent gains and the latest Q1 results, he noted.
The Q1 FY27 earnings season continues to progress ahead of expectations, with small-cap companies emerging as the strongest performers relative to large- and mid-cap peers, the analyst said. “Investors will closely watch the upcoming RBI policy meeting for commentary on inflation risks, liquidity conditions, and the future policy trajectory, although interest rates are widely expected to remain unchanged,” he added.
Wall Street's main indexes opened higher on the first trading day of August as signs of de-escalating tensions in the Middle East dragged down crude prices, while investors prepared for another week packed with earnings and economic data.
U.S. President Donald Trump on Sunday said talks with Iran to reopen the Strait of Hormuz would take place sometime on Monday, though Iran contradicted him.
Brent crude prices slid over 5.5% while the yield on the two-year Treasury note dipped 3.9 basis points.
Most megacap and growth stocks rose in early trading. Amazon.com gained 4.8% to reach $3 trillion in market value for the first time.
European shares started the month higher on Monday as oil prices fell sharply on hopes for renewed diplomatic efforts to end the Iran war, while AstraZeneca sank on reports of merger talks with U.S. rival Bristol Myers Squibb.
The pan-European STOXX 600 index closed up 0.5% at 652.09 points and hovered near a record high it clinched on Friday. Most major regional bourses ended higher but London's FTSE was the only outlier and inched down 0.1%.
Nifty rebounded after nearly two months of consolidation, delivering a decent recovery despite the prevailing subdued market sentiment, said Rupak De, Senior Technical Analyst at LKP Securities. However, based on the closing price-adjusted chart, the index has rallied up to its 200-day moving average (200DMA), which is a crucial resistance level, he added.
"From here, two scenarios are possible. The first is that the index faces resistance near the 200DMA and retraces towards the 24,400 level, allowing the recent sharp rally to cool off. Alternatively, if the index manages to break and sustain above the 200DMA, i.e., above 24,800, it could trigger follow-up buying and extend the rally towards 25,000–25,350," according to the analyst.
Most active stocks in terms of turnover
Muthoot Finance (Rs 2,433 crore), Redington (Rs 2,385 crore), Bajaj Finance (Rs 1,594 crore), Divis Labs (Rs 1,501 crore), Urban Company (Rs 1,367 crore), Maruti Suzuki (Rs 1,357 crore) and BSE (Rs 1,356 crore) were among the most active stocks on NSE in value terms. Higher activity in a counter in value terms can help identify the counters with the highest trading turnovers in the day.
Most active stocks in volume terms
Vodafone Idea (Traded shares: 23.54 crore), JP Power (Traded shares: 19.7 crore), Zee Entertainment Enterprises (Traded shares: 10.76 crore), Urban Company (Traded shares: 9.28 crore), Pine Labs (Traded shares: 7.1 crore), Redington (Traded shares: 6.9 crore) and Suzlon Energy (Traded shares: 5.53 crore) were among the most actively traded stocks in volume terms on NSE.
Urban Company, Balrampur Chini, Pine Labs, Aegis Logistics, Redington, LTIMindtree and Firstsource were among the stocks that witnessed strong buying interest from market participants.
Among the ones which hit their 52-week highs on NSE included Balrampur Chini, Redington, Divis Labs, Gabriel India, Grasim Industries, Paytm and Aditya Birla Group.
Stocks which witnessed significant selling pressure were Zee Entertainment Enterprises, Muthoot Finance, Blue Jet Healthcare, Latent View Analytics, Narayana Hruday, CG Power and Thermax.
Out of the 3,505 stocks that traded on the NSE on August 3, Monday, 2,358 stocks witnessed advances, 1,027 saw declines while 120 stocks remained unchanged.
