On Tuesday, March 24, Indian benchmark indices BSE Sensex and NSE Nifty 50 closed around 1.8 per cent higher. The 30-pack Sensex jumped 1,372.06 points to settle at 74,068.45, while the Nifty rallied 399.75 points to 22,912.40.
All of this came after US President Donald Trump decided to pause action in the Middle East. The question, however, remains: Will this rally last?
So far, the Sensex has plunged 13 per cent year-to-date. But on close inspection, the graph looks like the mood swings of the American president.
The Israel-US action on Iran led to the closure of the Strait of Hormuz, which in turn led to many restaurants shuttering temporarily and others halving their menu back in India after the LPG shortage snowballed. But the biggest tremor was felt on the stock market.
After Trump announced a temporary halt on strikes targeting Iranian energy infrastructure, Indian markets climbed on Tuesday. Among the biggest gainers on the Sensex were L&T, IndiGo, Eternal, Bajaj Finance, and Asian Paints. In fact, the only two losers were SBI and Powergrid.
Also Read
- Is this market manipulation or insider trading? Mystery surrounds massive trade minutes before Trump statement
- Red Monday: 26 out of 30 Sensex companies sink, HDFC Bank slumps on 3rd straight session
- Decoding Monday bloodbath on Dalal Street: What caused Sensex, Nifty to plunge more than 2 per cent?
Many market watchers have said that Asian markets have a solid base, and the crude oil price pullback has led to the rally.
While easing oil prices might have dispelled immediate inflation concerns, it would be assuming too much if we say investors in Indian markets have a bigger risk appetite now.
If the past month has been any indicator, the massive slide and the volatility of Indian markets have revealed our exposure to global headwinds. Factor in the foreign investor movements, and it feels like the Sensex-Nifty graphs are at the mercy of other world leaders.
