Indian benchmarks rebounded Monday. Crude oil slid 1.5%, global markets rallied. FII inflows and buying in Reliance, HDFC Bank, Infosys drove the move. Axis Direct sees supportive cues.
Indian stock benchmarks rebounded Monday morning, with the Sensex climbing 407 points and the Nifty rising 115 points. A 1.5% drop in Brent crude to $79.36 a barrel and supportive global cues drove the move, traders said.
Foreign institutional investors bought equities worth ₹4,859 crore on Friday, exchange data showed. That followed a strong rally in U.S. tech stocks on Thursday, with the Nasdaq and S&P 500 gaining ground. U.S. markets were closed Friday for the Juneteenth holiday.
Among Sensex components, Reliance Industries, Tech Mahindra, Infosys, Bajaj Finance, HDFC Bank and HCL Tech led the gains. Titan, InterGlobe Aviation, Adani Ports and ITC lagged.
The U.S. and Iran agreed on a roadmap aimed at a final agreement within 60 days after talks in Switzerland, according to a joint statement from mediators Pakistan and Qatar. The news added to the positive tone for crude-sensitive stocks, though the actual impact on supply remains uncertain.
Rajesh Palviya, Head of Research at Axis Direct, said global cues remain supportive despite the Federal Reserve's cautious stance.
The crude oil decline benefits sectors with high energy costs. Reliance Industries, with its refining and petrochemical operations, gains from lower feedstock costs. Airlines like InterGlobe Aviation, however, lagged, suggesting the move was more about index-level buying than sector rotation. IT stocks such as Infosys and Tech Mahindra rode the global tech rally, Palviya noted.
HDFC Bank and Infosys, both among the winners, carry Alpha Scores of 43 and 57 respectively on AlphaScala's proprietary model, indicating mixed to moderate sentiment. The broader market's reaction to crude and global cues will be tested in the coming sessions as the Fed's rate path remains uncertain.
On Friday, the Sensex had fallen 607 points and the Nifty 155 points, snapping a winning streak. Monday's rebound recouped most of those losses, with the Sensex back above 77,000 and the Nifty above 24,100.
In Asian markets, South Korea's Kospi and Japan's Nikkei 225 traded higher, while Hong Kong's Hang Seng slipped. The mixed regional performance reflects lingering uncertainty over global growth and monetary policy.
The next round of U.S.-Iran talks is expected within 60 days, according to the joint statement. A sustained drop in crude below $78 could open the door for more gains in oil-sensitive sectors, traders said.
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