Indian equity markets opened higher on Tuesday, recovering from the sharp sell-off in the previous session triggered by a spike in crude oil prices that briefly touched $120 per barrel, as easing oil prices and improving global sentiment lifted investor confidence.

The BSE Sensex and the Nifty 50 rebounded in early trade, tracking gains in global markets and a sharp pullback in oil prices after geopolitical concerns showed signs of easing. The Sensex rose as much as 960 points, or 1.23%, in early deals, while the Nifty 50 climbed 276 points to move above the 24,300 mark, recovering from the previous session’s steep decline.

Mid- and small-cap stocks also joined the rally, with the Nifty MidCap and Nifty SmallCap indices rising 1.31% and 1.27%, respectively.

Oil slump eases market anxiety

Global oil prices retreated sharply after signals that geopolitical tensions may de-escalate. Brent crude oil declined more than 11% to around $88 per barrel on Tuesday after Donald Trump indicated that the conflict involving Iran could be nearing an end.

The easing in oil prices provided relief to investors after crude had briefly surged close to $120 per barrel, triggering fears of inflationary pressure and supply disruptions. Lower crude prices are particularly beneficial for India, which relies heavily on energy imports.

The India VIX, often referred to as the market’s “fear gauge,” declined more than 15% to 19.80, indicating easing near-term volatility.

Global sentiment also improved after strong gains on Dow Jones Industrial Average and the Nasdaq Composite, which rose as oil prices retreated. Asian markets followed suit, with benchmarks such as the Nikkei 225 and Kospi trading higher.

Aviation, infra stocks lead gains

Among Sensex constituents, InterGlobe Aviation, UltraTech Cement, Asian Paints, Adani Ports and Special Economic Zone, and Larsen & Toubro were among the top gainers, rising 2–3% in early trade. Other stocks trading higher included Mahindra & Mahindra, Tata Steel, Titan Company, ICICI Bank, and State Bank of India.

On the downside, Reliance Industries slipped over 1%, while IT stocks such as Infosys, Tech Mahindra, Bharti Airtel, and HCLTech traded lower.

Sectorally, buying interest was visible in auto, metals, PSU banks and consumer durables. The Nifty Consumer Durables Index led the gains with a rise of over 2%, followed by the Nifty Auto Index, which gained around 1.7%. The Nifty PSU Bank Index, Nifty Pharma Index, and Nifty Metal Index also traded higher.

However, IT stocks remained under pressure, with the Nifty IT Index slipping marginally. The Nifty Oil & Gas Index also traded slightly lower.

Analysts see crude swings driving volatility

According to V K Vijayakumar, the recent turbulence in global equity markets has largely been driven by extreme swings in crude oil prices triggered by geopolitical uncertainty.

“Extreme volatility in crude prices has triggered heightened volatility in stock markets across the world. The panic reaction in crude prices, which took Brent crude to near $120 yesterday, has reversed this morning with prices plunging to around $89,” he said.

“This kind of swing of nearly $30 in a single day reflects the huge uncertainty surrounding the impact of the West Asian conflict on global crude supplies.”

Despite the volatility, Vijayakumar advised investors to remain invested, noting that geopolitical crises typically have short-term impacts on markets.

Hariprasad K, a SEBI-registered research analyst, said Indian markets were poised for a rebound as global risk sentiment improved following signs that tensions in Middle East could de-escalate.

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