Sensex Gains Over 300 Points As Crude Falls; Rupee Snaps 8-day Losing Streak

Indian benchmark indices traded firmly higher on Thursday morning, supported by a sharp fall in crude oil prices and improving sentiment after signs emerged that the US and Iran may be moving closer towards a deal to ease the prolonged West Asia conflict. Gains were broad-based across sectors, while a rebound in the rupee and easing bond yields added support to domestic markets.

At around 9:35 am, the BSE Sensex rose 339 points or 0.45% to 75,657.39, while the NSE Nifty gained 106.85 points or 0.45% to trade at 23,765.85, moving closer to the key 23,800 level.

Broader markets also participated in the rally. All major NSE sectoral indices traded in positive territory, with smallcaps leading gains. The Nifty Smallcap index advanced 1.10%, reflecting improved risk appetite among investors. However, gains in defensive sectors remained relatively muted. Nifty IT rose 0.15%, Nifty Oil & Gas gained 0.16% and Nifty Pharma moved up 0.20%.

Among individual stocks, Grasim Industries emerged as the top Nifty gainer and climbed 3.01% in early trade. InterGlobe Aviation gained 2.54%, while Siemens Energy India, Bharat Electronics, Asian Paints and Tata Steel also traded higher.

Crude Decline Brings Relief

The biggest trigger for the rally was the sharp decline in global oil prices overnight. Brent crude traded near $105 per barrel after falling nearly 5%, as investors reacted to comments from US President Donald Trump suggesting that negotiations with Iran were entering the final stages.

Trump said talks aimed at ending the conflict were progressing but also warned that military action remained possible if discussions fail. While the mixed messaging kept traders cautious, markets interpreted the developments as a sign of possible easing in geopolitical tensions.

Lower oil prices offered relief to Indian markets, which have remained under pressure due to concerns over inflation, current account deficits and a weakening currency.

Rupee Rebounds After Eight Sessions

The Indian rupee snapped its eight-day losing streak and opened sharply higher at 96.30 against the US dollar compared with Wednesday's close of 96.82.

The domestic currency gained 52 paise after persistent pressure in recent sessions. Though the rupee rebounded strongly, it remains down nearly 7% on a year-to-date basis.

Bond markets also reflected improving sentiment. India's benchmark 10-year bond yield eased to 7.04% from 7.07% in the previous session as lower crude prices eased inflation concerns.

The Reserve Bank of India also announced a $5 billion buy-sell swap auction for a three-year tenor scheduled for May 26 to inject rupee liquidity into the banking system.

Melody Frenzy Lifts Parle Industries

Shares of Parle Industries extended gains for a second straight session and rose nearly 5% on Thursday after hitting the upper circuit in the previous session, driven by a social media-fuelled rally around the viral "Melody" trend.

The stock has attracted strong investor attention despite having no business connection with Melody toffees or privately held Parle Products. The rally followed a viral video featuring Prime Minister Narendra Modi and Italian Prime Minister Giorgia Meloni, which triggered widespread social media chatter around Melody and sparked confusion among retail investors.

The namesake connection appears to have driven speculative interest in Parle Industries, resulting in a sharp rise in trading activity. Similar episodes of mistaken identity have surfaced in the past, where unrelated listed companies witnessed sudden rallies after becoming linked to trending brands, products or events on social media.

Buy-on-dips Strategy Continues

VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said recent market movements indicate a buy-on-dips structure remains intact.

"The recent market movements indicate a buy on dips market construct. Buy on dips strategy has been working well. It appears that the sustained selling by FPIs has also stopped since they were buyers on a couple of days recently," he said.

Vijayakumar added that corrections in South Korea's KOSPI and Taiwan's TAIEX may eventually benefit India if foreign investors start reallocating funds.

He noted that lower crude prices and stability in the rupee remain critical variables for markets.

"Brent crude declining to $106 this morning is a positive signal. Perhaps the market is taking cues from President Trump's remark that the conflict will end soon and oil prices would plummet. But going by past experience, President Trump's words cannot be trusted and, therefore, we will have to see more tangible results," he said.

He also said quarterly earnings have remained largely healthy so far, although the impact of the energy crisis could begin reflecting in Q1 FY27 numbers.