Stock market today: Nifty50 and BSE Sensex, the Indian equity benchmark indices, soared in trade on Tuesday after Donald Trump announced a ceasefire between Iran and Israel. While Nifty50 went above 25,250, BSE Sensex was up over 1,000 points. At 12:30 PM, Nifty50 was trading at 25,289.05, up 317 points or 1.27%. BSE Sensex was at 82,916.79, up 1,020 points or 1.25%.Various sectors demonstrated positive performance during early trading hours. Nifty Bank, Financial Services, Auto, IT, Metal, PSU Bank, Consumer Durables, and Oil & Gas indices registered gains ranging from 1% to 2%. Additionally, the broader market indicators, including Nifty Midcap and Smallcap indices, commenced trading with approximately 1% increase.The total market capitalisation of BSE-listed companies increased by Rs 5 lakh crore, reaching Rs 452.82 lakh crore, according to an ET report.
Why is the stock market rising today? Top 4 factors
1. Iran-Israel Diplomatic BreakthroughMarkets responded positively to news of an agreed phased ceasefire between Iran and Israel, following a fortnight of heightened military conflict. US President Trump announced the development, acknowledging Qatar’s diplomatic role in the process.Nevertheless, the situation remains volatile. Early Tuesday, the Israeli military reported detecting additional missiles from Iran. Multiple cities, including Jerusalem, activated warning sirens, prompting residents to seek refuge in underground shelters after receiving mobile notifications.The IDF confirmed the alert activation via social media, coinciding with the missile launch. AP reports indicated that citizens received advance notifications regarding the incoming missile threat.2. Oil Prices DipTuesday witnessed a more than 3% reduction in oil prices, following Monday’s 9% decline after Iran’s measured response against a US air base indicated possible reduction in tensions.As concerns about disruption to the strategic Strait of Hormuz shipping route diminished, US crude prices decreased by 3.4% to $66.15 per barrel, reaching levels not seen since June 11.Oil prices experienced a substantial 6% reduction on Monday after Iran’s missile strike on a US air base in Qatar, responding to previous American attacks on Iranian nuclear installations.The sustained reduction in oil prices benefits India, a nation largely dependent on imported energy. Reduced oil costs help control inflation and reduce the fiscal deficit, benefiting both government administrators and the public.3) Global Markets SurgeIndian equity markets followed the worldwide uptrend, with a strong opening as reduced Iran-Israel hostilities boosted market confidence. US President Donald Trump announced on Truth Social that “the war ‘ended'” with a ceasefire to be implemented within 12 hours.Asian markets demonstrated robust performance, with the MSCI Asia-Pacific index (excluding Japan) rising 1.8%. Additionally, Japan’s Nikkei increased by 1.4%, whilst China’s blue-chip index advanced 1%, and Hong Kong’s Hang Seng climbed 1.7%.4) Currency MovementThe dollar index continued its downward trend, decreasing 0.3% to 98.12 after the ceasefire announcement. This weakening of the American currency contributed to the positive atmosphere in global financial markets.US Treasury yields increased by 2 basis points to 4.35%, following a 5 bps reduction overnight. Federal Reserve Vice Chair for Supervision Michelle Bowman suggested that interest rate reductions might be forthcoming, citing labour market concerns.Market attention has shifted to Fed Chair Jerome Powell’s upcoming Congressional testimony on Tuesday. Thus far, Powell has maintained a conservative stance regarding immediate rate reductions.(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)
