Indian markets surge as oil prices fall, US-Iran peace hopes lift sentiment

Indian shares were in the green on Thursday, with the BSE Sensex and the NSE Nifty leaping near a three-month high as falling crude oil prices and the optimism over the resolution of US and Iran issues alleviated fears among investors.

The 30-share BSE Sensex soared 1,403.71 points, or 1.82%, to 78,689.87, and the 50-share NSE Nifty gained 378.85 points, or 1.58%, to 24,340.40.

The rally came after a five-session winning run, which saw the Sensex jump by 4,055.37 points, or 5.53%, while the Nifty rose 1,261.75 points, or 5.55%.

Brent crude, the international oil marker, declined almost 10% during the last session and was trading at $93.61 a barrel on Thursday, stepping back from rising worries over India’s import bill and inflation.

Furthermore, investors welcomed the US midterm election results that gave Democrats control of Congress, expecting it to put pressure on the Trump administration to come to the table with Iran. Investors were encouraged by the US midterm election results, which delivered Democrats control of Congress, hoping this would apply pressure on the Trump administration to enter talks with Iran.

Foreign institutional investors purchased Rs 7,284.03 crore worth of Indian stocks on Wednesday, as per data from stock exchanges.

Analysts, though, warned that the slide in oil reflected hopes of a diplomatic breakthrough, not an actual deal, and markets remain exposed to the risk of further flare-ups in tensions.