Benchmark indices opened sharply higher on Wednesday morning, with the Sensex opening at 82,448.80, up from its previous close of 82,055.11, and climbing further to 82,592.05 at 9:46 am, a gain of 536.94 points or 0.65 per cent.
The Nifty also opened stronger at 25,150.35 compared to its previous close of 25,044.35, and was trading at 25,192.85 at 9.46 am, up 148.50 points or 0.59 per cent. The rally came as markets responded positively to a tentative ceasefire between Israel and Iran, which eased geopolitical concerns and pushed crude oil prices lower.
The 30-stock Sensex opened at 82,449 against the previous close of 82,055, marking a gain of 0.65 per cent, while the broader Nifty index opened at 25,150 compared to its previous close of 25,044, representing a 0.59 per cent increase. The positive opening came after GIFT Nifty indicated a gain of 116 points for the broader index.
“Peace pays... US stocks rallied as West Asia tensions cooled and oil prices continued to fall,” said Vikram Kasat, Head of Advisory at PL Capital. “With the ceasefire agreement holding for now, attention is likely to turn back to tariffs in the coming days.”
The market rally was led by consumer goods and technology stocks, with Nestle India emerging as the top gainer on the Nifty 50, surging 2.29 per cent to trade at 2,420. Titan Company followed with a 1.52 per cent gain to 3,579.50, while Tata Consumer Products rose 1.35 per cent to 1,122.70. HCL Technologies added 1.23 per cent to reach 1,712.60, and Adani Enterprises climbed 1.19 per cent to 2,535.50.
“The nifty ended higher yesterday but not before selling off hard at the close,” noted Akshay Chinchalkar, Head of Research at Axis Securities. “Therefore, who gets the upper hand in the near-term will depend on whether yesterday’s high or low gets taken out first, ideally on a closing basis.”
On the downside, Bharat Electronics Limited led the losers, falling 1.22 per cent to 413.40, followed by Kotak Mahindra Bank, which declined 0.70 per cent to 2,208. Eicher Motors dropped 0.19 per cent to 5,618.50, while SBI Life Insurance and Dr. Reddy’s Laboratories posted marginal declines of 0.15 per cent and 0.05 per cent respectively.
Crude, precious metals falls
The commodity sector witnessed significant movement as crude oil prices fell sharply following the ceasefire announcement. Brent crude futures dropped 6.1 per cent to $67.14 per barrel, while WTI crude fell 6 per cent to $64.37. However, crude oil futures traded higher during Wednesday morning session, with September Brent oil futures at $66.99, up 1.24 per cent, and August WTI futures at $65.23, up 1.34 per cent.
“Crude oil extended its fall after the US President announces ceasefire in the Israel-Iran war,” explained Rahul Kalantri, VP Commodities at Mehta Equities. “De-escalation in the middle-east eases supply risk of crude oil and pushed prices lower.”
The precious metals sector faced pressure as gold and silver fell sharply after the ceasefire confirmation. MCX Gold prices dropped 2.91 per cent to 96,500, marking the biggest single-day fall since November 25, 2024. “Gold and silver fell sharply after the US President confirmed a ceasefire in the Israel-Iran conflict, triggering profit-booking amid easing geopolitical stress,” Kalantri added.
FII’s spending spree continues
Foreign Institutional Investors continued their selling spree for the second consecutive day, offloading equities worth ₹5,266 crore on June 24. However, Domestic Institutional Investors extended their buying streak, purchasing equities worth ₹5,209 crore on the same day, providing support to the market.
“A significant contributor to this resilience has been FII buying during the crisis. Interestingly FIIs have been selling, like yesterday, after the crisis blows over,” observed Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments. “On the other hand DIIs have been sustained buyers in the market, thanks to the continuing inflows into mutual funds.”
The banking sector showed mixed performance, with Bank Nifty finding support at current levels. Technical analysts suggest the index may get support at 56,200 followed by 55,900 and 55,600, while resistance is expected at 56,500, followed by 56,800 and 57,000.
Cautious outlook
Specific sectors showed promise based on regulatory developments. Small finance banks gained traction as the Reserve Bank of India eased lending norms, with Equitas Small Finance Bank rising 0.52 per cent, Ujjivan Small Finance Bank advancing 0.81 per cent, and ESAF Small Finance Bank surging 1.24 per cent.
The telecommunications sector also attracted attention, with Vodafone Idea gaining 4.89 per cent on expectations of possible dues relief. Hindustan Zinc advanced 0.56 per cent as the company projected strong free cash flow generation.
“There are many kinds of risks... But volatility may be the least relevant of them all,” quoted Prashanth Tapse, Senior VP Research at Mehta Equities, referencing Howard Marks’ investment philosophy. “Markets remain sentiment-driven, turning bullish on cues like a tentative Iran-Israel ceasefire and WTI crude dipping to $65.”
Technical analysts remain cautiously optimistic about the near-term outlook. Hardik Matalia, Derivative Analyst at Choice Broking, noted that “after a positive opening, Nifty can find support at 25,000 followed by 24,900 and 24,800. On the higher side, 25,100 can be an immediate resistance, followed by 25,200 and 25,300.”
The India VIX, which measures market volatility, declined 2.88 per cent to trade at 13.64, indicating reduced fear among investors. “Given the current global backdrop and intraday volatility, traders are advised to remain cautious, avoid large overnight positions, and maintain strict stop-loss levels to manage risk effectively,” Matalia advised.
As markets continue to digest the geopolitical developments and their implications for various sectors, investors are closely watching for sustainability of the current rally beyond key resistance levels of 25,200-25,300 for the Nifty index.