Stock markets surge over 1% amid hopes of resumption of US-Iran peace talks

Mumbai: Benchmark stock indices Sensex and Nifty surged over 1 per cent on Wednesday as crude oil prices fell below the $100 per barrel mark amid hopes of renewed diplomatic engagement between the US and Iran.

The 30-share BSE Sensex jumped 1,263.67 points or 1.64 per cent to settle at 78,111.24. During the day, it zoomed 1,422.85 points or 1.85 per cent to 78,270.42.

The 50-share NSE Nifty climbed 388.65 points or 1.63 per cent to end at 24,231.30.

Among the 30-Sensex firms, InterGlobe Aviation, Eternal, Power Grid, Tech Mahindra, Tata Consultancy Services, and Larsen & Toubro were the major gainers.

Bharti Airtel, ICICI Bank and Axis Bank were the laggards.

Brent crude, the global oil benchmark, was trading at USD 95.74 per barrel, up by 1.4 per cent.

US President Donald Trump has said that the war with Iran is “close to over,” asserting that if he pulled up stakes right now, it would take Tehran 20 years to rebuild the country.

“I think it’s close to over, yeah. I view it as very close to being over,” Trump told Fox News in an interview that will be telecast later Wednesday.

As per a US media report on Tuesday, Trump said that a second round of talks with Iran could be held in Islamabad “over the next two days".

"The primary trigger for today’s rally was a visible de-escalation in geopolitical concerns. Reports indicating a potential easing of tensions in the Middle East, along with renewed hopes around US–Iran dialogue, helped restore risk appetite.

"This shift was further reinforced by a sharp decline in crude oil prices, with Brent falling below the 95 dollar mark. For an import-dependent economy like India, this provides meaningful relief by easing inflation pressures, supporting the currency, and improving margin outlook across sectors," Hariprasad K, Research Analyst and Founder, Livelong Wealth, said.

In Asian markets, South Korea's benchmark Kospi, Japan's Nikkei 225 index, Shanghai's SSE Composite index and Hong Kong's Hang Seng index ended higher.

Markets in Europe were trading on a mixed note.

US markets ended in positive territory on Tuesday. The Nasdaq Composite jumped 1.96 per cent, the S&P 500 climbed 1.18 per cent, and the Dow Jones Industrial Average edged higher by 0.66 per cent.

"Optimism around potential US–Iran negotiations supported a broad-based market sentiment, driving oil prices below USD 100 as expectations of talks outweighed concerns over supply disruption," Vinod Nair, Head of Research, Geojit Investments Limited, said.

Stock markets were closed on Tuesday on account of Dr Baba Saheb Ambedkar Jayanti.

Foreign Institutional Investors (FIIs) again offloaded equities worth Rs 1,983.18 crore on Monday after a day's breather, according to exchange data. Domestic Institutional Investors (DIIs) bought stocks worth Rs 2,432.30 crore.

On Monday, the Sensex tumbled 702.68 points or 0.91 per cent to settle at 76,847.57. The Nifty plunged 207.95 points or 0.86 per cent to end at 23,842.65.