Sensex Jumps 654 Points, Nifty Trades Near Day’s High Above 24,590

Mumbai: Indian benchmark indices posted gains on Monday as falling crude oil prices, renewed foreign investment and global signals lifted sentiment. At 12:10 pm, the Sensex traded at 78,748.87, up 654.23 points or 0.84 percent.

The Nifty stood at 24,596.95, gaining 213.35 points or 0.87 percent. It touched an intraday high of 24,606.15, while the Sensex reached 78,895.10.

Cheaper Crude

Brent crude dropped 4.97 percent to $83.56 per barrel. India imports most of its crude oil requirements, so lower prices can reduce the import bill, ease inflationary pressure and support the rupee. The decline also reduced concerns about rising costs for companies.

Foreign Inflows

Foreign portfolio investors became net buyers in July, investing Rs 20,199 crore in Indian equities. This included Rs 6,731 crore through exchanges and Rs 13,467 crore through the primary market and other channels.

They also invested Rs 29,211 crore in debt under the general limit category. Volatility in South Korea and Taiwan reportedly encouraged some investors to consider India a relatively stable destination.

Diplomatic Hopes

Sentiment improved after US President Donald Trump indicated that talks between the US and Iran could restart on Monday. Hopes of diplomacy eased fears of an immediate disruption to West Asian oil supplies, contributing to crude’s decline.

Global Support

Asian shares traded higher, while US markets had ended Friday firmly. Nasdaq and other Wall Street futures gained nearly 1 percent, encouraging buying in risk assets, including Indian equities.

Stronger Rupee

The rupee appreciated 31 paise to 95.12 against the US dollar. Lower crude prices, foreign inflows, dollar weakness and support from the Reserve Bank of India aided the currency. A stronger rupee can lower import costs and improve overseas investor confidence.

Earnings Boost

Corporate results also supported buying. ITC climbed nearly 3.8 percent as brokerages welcomed cigarette volume growth despite weaker profit. Divi’s Laboratories gained 3.2 percent after reporting higher earnings. Urban Company surged almost 16 percent following a 44 percent rise in first-quarter revenue.