Key facts
- Indian stock markets extended their rally for a third consecutive day on Tuesday.
- Sensex gained over 250 points to trade at 76,550, while Nifty 50 rose above 23,900.
- The rally is fueled by optimism surrounding a potential Iran-US peace deal framework.
- Falling crude oil prices and a stable rupee are providing market resilience.
- HCL Tech shares were the top gainers, jumping 3%.
Indian stock markets surged for a third consecutive day on Tuesday, with the Sensex and Nifty extending their gains amid optimism surrounding a potential Iran-US peace deal framework. The Sensex gained over 250 points to trade at 76,550, while the Nifty 50 rose above 23,900. This rally follows a sharp 3% increase in benchmark indices over the previous two sessions. The India VIX, a measure of market volatility, dropped 2.5% to 14.35. HCL Tech shares were the top gainers, jumping 3%, with other IT and auto stocks also performing well. Broader markets also saw gains, with Nifty Realty, IT, and Auto sectors leading the advance, while Nifty Metal fell. The stability in the rupee, which appreciated to 94.71 against the dollar from a recent low of 96.96, and the sharp correction in Brent crude to below $84, are seen as positive macro factors providing resilience. However, concerns persist regarding the impact of a potentially below-normal monsoon on inflation and the dynamics of foreign institutional investor (FII) flows. Analysts note that while valuations in India may not warrant a sustained rally, the positive macro backdrop could lead to a tapering of FII selling. Core inflation remains firm at 3.9%, and the RBI recently raised its FY27 CPI forecast to 5.1%, making inflation dynamics a key monitorable.