Indian Markets Surge Amid Iran Peace Deal Optimism and Declining Oil Costs

Indian shares rallied on Monday as optimism over a potential U.S.-Iran peace agreement drove a sharp drop in oil prices and heightened expectations of easing inflationary pressures. The optimism also supported the rupee, which strengthened for a third consecutive session, reaching a two-week peak of approximately 95.28 per dollar.

U.S. President Donald Trump indicated on Saturday that a peace deal with Iran had been “largely negotiated,” prompting media reports suggesting that negotiations are underway to extend the temporary ceasefire by 60 days and reopen the strategically important Strait of Hormuz. Reports also indicated that Iran has agreed to dismantle its highly enriched uranium stockpile.

RBI Governor Sanjay Malhotra noted in an interview to Mint that the rupee may have been oversold following its sharp decline since the Middle East conflict began on February 28. His remarks added to the currency’s recent upward momentum.

The benchmark BSE Sensex jumped 1,073.61 points, or 1.42 percent, to settle at 76,488.96, tracking positive trends in global markets. The NSE Nifty index gained 312.40 points, or 1.32 percent, to close at 24,031.70. Mid-cap and small-cap indices on the BSE rose 0.8 percent and 1.2 percent, respectively.

Market breadth remained robust, with 2,793 shares advancing while 1,532 shares declined and 206 shares finished unchanged on the BSE.

Among key beneficiaries, Mahindra & Mahindra, SBI, ICICI Bank, Kotak Mahindra Bank, Bajaj FinServ, Eternal, HDFC Bank, Larsen & Toubro, and Bajaj Finance climbed 2-3 percent. Oil marketing majors BPCL, HPCL, and IOC rallied 3-4 percent following recent fuel price hikes and the substantial fall in international crude prices on renewed hopes of a U.S.-Iran accord.

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