Sensex jumps 544 pts, Nifty nears 24,800 as crude drop fuels 4-day rally

Indian equity benchmarks extended their winning streak to a fourth consecutive session on Monday, with the Nifty 50 surging 1.6% to close near the 24,800 mark. The BSE Sensex jumped 544 points, propelled by a sharp drop in global crude oil prices and sustained buying by foreign institutional investors (FIIs).

The rally marks one of the strongest single-day gains in recent weeks, as easing oil prices eased concerns over inflation and its impact on corporate margins. The drop in crude, a key import for India, also bolstered expectations of a more favourable interest rate trajectory.

Crude Oil Drop Lifts Sentiment

The sharp decline in crude oil prices was the primary catalyst behind Monday's surge. Lower oil prices reduce India's import bill, narrow the current account deficit, and help contain domestic inflation, all of which are positive signals for equity markets.

Brent crude futures fell sharply during the session, reflecting global demand concerns and supply-side developments. For Indian markets, this translated into broad-based buying across sectors, with oil marketing companies, airlines, and consumer goods stocks among the top gainers.

FII Buying Returns

Foreign institutional investors were net buyers during the session, adding to the positive momentum. After months of volatile flows, the return of FII buying has been seen as a vote of confidence in Indian equities, particularly amid a stable macroeconomic environment.

Domestic institutional investors also remained active, though the bulk of the buying pressure came from foreign funds. Analysts noted that the combination of lower crude prices and steady FII inflows has created a favourable backdrop for the market to test higher levels.

Mixed Start, Strong Close

The session began on a mixed note, with the Sensex opening over 150 points up while the Nifty briefly dipped to 24,600. However, buying momentum accelerated through the day, and indices closed firmly in the green.

The Nifty 50's 1.60% gain marked its best single-day performance in over a month, according to market data. The broader market also participated in the rally, with midcap and smallcap indices posting healthy gains.

Sectoral Highlights

• Oil & gas stocks surged on lower crude prices
• Banking and financials saw strong buying interest
• IT stocks rebounded after recent weakness
• Auto and consumer durables gained on margin optimism

Market breadth was positive, with advancing stocks outpacing decliners on both the BSE and NSE. The rupee also strengthened against the dollar, adding to the overall risk-on sentiment.

What to Watch

Investors will now focus on upcoming domestic economic data and global cues, particularly the trajectory of crude oil prices and any signals from the US Federal Reserve on interest rates. A sustained drop in oil prices could extend the rally, while any reversal could prompt profit-booking.

Market participants will also monitor FII flow data in the coming sessions to gauge whether the current buying trend is sustainable. The Nifty's ability to hold above 24,800 will be closely watched as a key technical level in the near term.