A fall in crude oil prices below the $100 mark lifted Indian equities for a second straight session, but the rupee’s slide to record lows highlighted the underlying fragility amid ongoing global tensions.
Benchmark indices extended their rebound on March 25, tracking positive global cues and easing concerns over the US–Iran conflict. The Sensex rose 1,205 points, or 1.63 percent, to close at 75,273.45 after touching an intraday high of 75,849.76. The Nifty 50 gained 394 points, or 1.72 percent, to settle at 23,306.45, after hitting 23,465.35 during the session.
The rally came as crude prices cooled below $100 per barrel on hopes of possible diplomatic engagement between the US and Iran. Improved sentiment also followed reports that negotiations could begin soon, easing fears of prolonged disruption in global energy markets.
Despite the equity rebound, the currency market painted a more cautious picture. The Indian rupee weakened further to close at 93.97 against the dollar, after hitting a record low of 93.98 intraday. Persistent foreign portfolio investor (FPI) outflows, strong dollar demand from oil importers, and month-end requirements continued to weigh on the currency.
So far this financial year, the rupee has depreciated nearly 10 percent, making it the worst-performing currency in Asia. Traders noted that dollar sales by the Reserve Bank of India helped prevent the currency from breaching the 94 level.
Market volatility, too, remained elevated. The India VIX eased marginally but stayed high at 24.64, indicating lingering uncertainty among investors.
On the flows front, FPIs remained net sellers, offloading shares worth ₹1,805 crore, while domestic institutional investors (DIIs) provided support with net purchases of ₹5,430 crore.
Broader markets outperformed for the second consecutive session, with mid cap and small cap indices rising over 2 percent each. Sectorally, consumer durables, realty, PSU banks, metals and financials led the gains, with all major indices ending in positive territory.
Investor wealth surged sharply, with total market capitalisation on the BSE increasing by about ₹15.8 lakh-crore over the past two sessions, including ₹8.23 lakh-crore added on March 25 alone.
Among Sensex stocks, UltraTech Cement, Bajaj Finance, Larsen & Toubro, Titan and IndiGo led the rally, while select IT and power stocks saw mild profit booking.
While equities are drawing support from softer oil prices and hopes of de-escalation, the sharp weakness in the rupee and continued FPI outflows suggest that risks remain firmly in place.