Indian benchmark indices opened sharply higher on Monday, tracking firm global cues, easing crude oil prices, and optimism around a possible U.S.-Iran deal that could ease geopolitical tensions in West Asia. Crude oil prices slipped below the $100-per-barrel mark amid hopes of progress in U.S.-Iran negotiations, boosting risk appetite across global markets.

The 30-share BSE Sensex surged 908.98 points, or 1.21%, to 76,324.33 in early trade after opening at 76,135.82. Meanwhile, the broader Nifty 50 climbed 264.40 points, or 1.11%, to 23,982.50, hovering close to the psychologically important 24,000 mark.

Broader markets also surged in early trade, with the Nifty Midcap 100 rising 0.89% and the Nifty Smallcap 100 gaining 1.23%, indicating broad-based buying interest across market segments.

Market volatility, as measured by the India VIX, fell sharply by over 5% to 17 after a recent surge, as easing concerns over crude oil prices and improved currency stability boosted investor risk appetite.

M&M, HDFC Bank, IndiGo, L&T lead rally

On the Sensex pack, barring Tata Consultancy Services, Sun Pharmaceutical Industries, and NTPC, all other 27 stocks were trading in the green zone. Mahindra & Mahindra topped the gainers’ chart with a rise of 2.46%, followed by HDFC Bank, which advanced 2.42%.

Engineering and infrastructure major Larsen & Toubro gained 1.82%, while aviation stock InterGlobe Aviation, the operator of IndiGo, climbed 1.68%.

Among others, Hindustan Unilever, Maruti Suzuki India, Asian Paints, and Titan Company gained up to 1.6%.

Banking and financial stocks remained in focus, with Bajaj Finance rising 2.26% and Bajaj Finserv adding 1.95%. Kotak Mahindra Bank, State Bank of India, ICICI Bank, and Axis Bank also traded firmly in the green.

Among sectoral indices, auto stocks led the rally, with the Nifty Auto index jumping 2.28%. Banking shares also remained firmly in focus, with the Nifty Private Bank and Nifty PSU Bank indices advancing 1.55% and 1.52%, respectively. Realty, oil & gas, FMCG, and financial services indices also traded in positive territory. However, gains in IT and metal counters remained muted amid lingering concerns over global growth and export demand.

Optimism around U.S.-Iran peace talks boosts sentiment

VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said the market has started the week on a positive note as crude oil prices slipped below $100 per barrel amid expectations of a possible U.S.-Iran agreement.

“We are starting the week on a positive note. Crude has dipped by $5 to below $100 on expectations that the U.S. and Iran are close to a deal. The market will wait and watch for clarity and certainty since many similar expectations have been belied since the start of the war,” he said.

He added that if the expected deal materialises and crude prices continue to soften, it could become a turning point for the market. Vijayakumar also highlighted better-than-expected March quarter earnings and the strong performance of digital platform companies as key positives supporting market resilience.

According to him, the appreciation in the rupee from its recent low of 96.96 against the dollar is another encouraging sign, as currency stability is important for attracting foreign portfolio inflows back into Indian equities.

Hitesh Tailor, Research Analyst at Choice Equity Broking, said improving global market sentiment and easing geopolitical concerns have strengthened overall investor confidence.

“Positive global market sentiment, strength across major Asian markets, and easing concerns around geopolitical tensions have improved risk appetite among investors, which may continue to support bullish momentum in the near term,” he said.

Tailor noted that foreign institutional investors (FIIs) turned aggressive sellers on May 22, offloading equities worth ₹4,440.5 crore. However, domestic institutional investors (DIIs) continued to lend support, purchasing equities worth ₹6,003.5 crore, helping cushion the broader market weakness.

Meanwhile, investors are also tracking the impact of rising domestic fuel prices. State-run oil marketing companies raised petrol and diesel prices again on Monday, marking the fourth increase since May 15. Cumulative hikes in fuel prices have now neared ₹7.5 per litre amid elevated crude prices and rupee weakness. Analysts believe sustained increases in fuel prices could keep inflation concerns alive despite the current market optimism.

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