Mumbai: Indian equity gauges rallied on Monday, with the Sensex climbing more than 1,200 points and the Nifty reclaiming the 23,400 mark.
Reliance Industries (RIL) emerged as the biggest contributor to the market rise, with its shares soaring 11.6%, or ₹135.10, to ₹1,299. Easing crude oil prices, renewed expectations of a diplomatic breakthrough in the Iran conflict, foreign fund inflows and secular gains across Asian markets further supported investor sentiment.
The BSE Sensex jumped 1,233.25 points, or 1.66%, to close at 75,692.78, while the NSE Nifty advanced 387.70 points, or 1.68%, to settle at 23,440.80.
The rally extended to other energy-linked stocks too.
This was led by a 5.4% rise in GAIL, while upstream oil companies advanced 3.6%. Metals and cement stocks also witnessed strong buying, rising 3% each. Tata Steel gained nearly 6%.
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"The core story is oil as Brent fell about 3% to near $110 as US-Iran peace talks took some of the war premium out of crude," said Lokesh Manik, senior research analyst at Vallum Capital. "For an economy that imports most of its oil, that means relief on the current account, input costs and margins and with crude high and foreign money cautious, investors are paying for earnings certainty and liquidity. The success of Jio has also added a feather in Reliance's cap," Manik said.
Brent crude, the global oil benchmark, declined around 3% to $110 per barrel, easing from a six-month high amid hopes of a diplomatic breakthrough. Iranian and Qatari officials held discussions for the third consecutive day to push for an agreement to end the US-Israeli war on Iran.
Broader markets gained on Monday, with Nifty Midcap 150 and Smallcap 250 indices rising 1.2% and 1.3%, respectively. Asian markets traded higher - South Korea's Kospi rising 2.2%, China's Shanghai Composite gaining 1% and Hong Kong's Hang Seng up 0.4%.
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Brokerages, though, cautioned against interpreting Monday's gains as a definitive reversal of the recent volatility.
Improving foreign institutional investor buying and wider participation across sectors and broader markets were additional positives, according to Ajit Mishra, senior vice-president, research, Religare Broking. However, sustaining the recovery would require continued institutional inflows, further moderation in crude prices and broader earnings support. Mishra advised investors to use the improving sentiment to selectively accumulate quality stocks rather than chase sharp intraday gains.
