Stocks rise, crude oil drops as the war scream fades

Copyright © HT Digital Streams Limit all rights reserved. As a ceasefire in Western Asia after 11 days of conflict, the markets bet that the worst of the disruption was behind. (Reuters) Summary The rally was supported by the Western Asia wire, a falling dollar and a significant inflow of funds from different domestic institutional investors above just mutual funds. Indian benchmark indices have risen to recycle the levels of nine months ago, as investors have rejoined lower oil prices, a weaker dollar and strong domestic flow back home. Market experts believe the combination is at least good for the bulls. As a ceasefire in Western Asia after 11 days of conflict, the markets bet that the worst of the disruption was behind. The Nifty closed 1.21% or 304.25 points higher at 25,549, while the Sensex closed 1.21% or 1,000 points at 83,775,87. Thursday’s closure was the highest since October 1 when the Nifty traded on 25,796.9 and the Sensex at 84.266.29. The profits were led by HDFC Bank, Reliance Industries, Bharti Airtel, Icici Bank and Bajaj Finance, which together make up nearly three fifths of the Nifty’s profits. Reliance Industries’ market cap has crossed £ 20 trillion for the first time in nine months to touch £ 20.23 trillion. It was at £ 20.65 trillion on September 27 last year, when the Nifty touched a record of 26,277.35. Dollar, derivatives Thursday’s rally coincided with the expiry of the June series derivatives – each series closes on the last Thursday of a month – which had the Nifty -Gins almost 3% from 24,833.6 at the expiry of May to 25,549 in June expiration. According to the preliminary data of NSE, Fiis only bought shares worth £ 12,692 on Thursday, their highest one-time purchase since June 28, 2023, which helped the rally was the drop in the dollar index-which included the Greenback against a basket of six currencies, including the euro, pound and yen-to a year low of 97.22. A weaker dollar increases the returns of risky emerging market stocks. In addition, the refrigeration in Brent-RU from $ 78.85 a barrel on January 19 is at the peak of the Israeli-Iran conflict to $ 68.5 at the time of writing on Thursday. Global Risk-On “Lower Oil, Dollar, Reduced in Interest Rates Home and Rising domestic equity inflows have aligned Indian stocks with global counterparts, which are at a global risk,” says Nitin Jain, CEO and CIO, Kotak Mahindra Asset Management Singapore. Interestingly, Jain said that not just mutual funds, other domestic institutional investors (DIIs) also pump money into Indian stock markets. In the first five months from 2025 to last Friday, the net inflow of DIs stood other than mutual funds at $ 13 billion, more than the $ 11 billion invested in the whole of 2024. “It shows that not just MFS, but banks, insurance and pension funds are the leading,” he said. Cooling rough cheaper crude oil benefits India, which imports 85%, or 5.5 million barrels a day, of its oil requirement. Investors became £ 3.5 billion richer after Thursday’s rally. Options data for the week that ended July 3 indicates a range of 3% for the market from 25210 to 25890, with a prejudice to the higher point of the range. It is supported by Fear Gauge India VIX which falls to a three -month low of 12.59. The annual average of the index is 15.52. A lower lecture indicates confidence while a higher lecture implies rising risk-separate sentiment. Over the past two days, global oil prices – especially Brent – have cooled down and dropped below $ 70, reflecting the relief of geopolitical tension, which was a great uncertainty for India, said Sachin Shah, executive director and fund manager at Emkay Investment Managers. With a rough below the threshold, a key risk seems to have dropped, Shah added, saying that geopolitical problems appear to be going, it seems that India is in a safe zone. What will continue next, the earnings season, the return of world capital and further relief of crude prices are the most important triggers for Indian markets, experts say. “After three poor quarters in FY25, Q4 showed signs of stabilization. A supporting macro-background-driven by RBI’s liquidity infusion and a deeper-than-expected rate reduction-expected to increase the demand for credit increase, which was historically low. The consensus for FY26 earnings growth of 10-11% also seems feasible, especially with the improvement of molons, rising rural income and the relief of inflation, Mathai added. Shah van Emkay investment managers added that there may be a possible shift from world capital to emerging markets such as India, as investors sell dollar assets and redistribute geographical areas and asset classes. “So far, FII inflow remains subdued, but any bakkie can significantly increase the sentiment,” he said. Vinay Jaising, CIO and Head of Stock Advice at Ask Private Wealth said that the ownership of FII is at a 12 -year low of about 16%, creating room for re -entry. In addition, crude oil that drops below $ 65 – falls below India’s $ 80 comfort zone – further help in containing inflation and managing fiscal deficits, Shah said. Strong Outlook Jaising or Ask Private Wealth said the prospects for Indian stock markets continue to be strong. Domestic inflows, especially from retail investors, are structurally strong and here to stay, as the contribution of the retail India to GDP via household savings from £ 0.4 billion in 2014 extends to £ 4 billion, equivalent to 1.3% of GDP – a 10x rise, Jaising said. “The rupee remains firm in the midst of US political and debt issues, while India’s risk premium has decreased. With revenue downgrades probably behind us and the revisions probably ahead, the prospects look strong,” Jaising added. Catch all the business news, market news, news reports and latest news updates on Live Mint. Download the Mint News app to get daily market updates. More Topics #stock Market Read Next Story