Markets extend rally as easing global tensions lift sentiment; financials lead gains

Indian equity markets sustained their upward move on Tuesday, drawing strength from improving global cues and expectations of a possible de-escalation in the US–Iran conflict. The benchmark indices opened firm and built on gains through the session, with the Nifty crossing the 23,000 mark and the Sensex registering a sharp intraday rise.

The rally was broad-based, with banking and financial stocks at the forefront. Heavyweights in the sector lent stability to the indices, while midcap and smallcap shares outperformed, reflecting a revival in risk appetite among investors. Market breadth remained decisively positive, with nearly all Nifty constituents trading in the green during early hours.

Softening crude oil prices added to the positive undertone, offering relief on inflation concerns and supporting sentiment in import-dependent sectors. Analysts said the easing of geopolitical tensions, even if tentative, has reduced immediate pressure on global markets and improved visibility for equities.

That said, underlying caution has not dissipated. Foreign institutional investors have continued to pare exposure, with outflows remaining significant through March. Participants remain watchful of global developments, particularly on the geopolitical front, which could quickly alter the trajectory of capital flows and commodity prices.

IT stocks, however, lagged the broader market. Persistent concerns around global demand and earnings visibility kept the sector under pressure, even as other segments advanced.

For now, the market’s direction appears tied to external cues, with domestic fundamentals providing support but not insulation from global volatility.