GIFT Nifty jumps nearly 1% after reports of US relief on Iran oil sanctions

GIFT Nifty surged nearly 1% after reports suggested the United States may temporarily ease sanctions on Iranian oil exports as part of ongoing diplomatic discussions. The sharp move higher signalled a positive start for Indian equities after volatile trading in the earlier session, when concerns over rising crude oil prices and escalating tensions in West Asia had weighed heavily on market sentiment.

According to reports, Iran’s foreign ministry spokesperson said the country remains focused on ending the ongoing conflict. Iranian news agency Tasnim also reported that the US has proposed a temporary waiver on sanctions related to Iranian oil exports until a final agreement is reached.

The developments raised hopes that additional Iranian crude supply could return to global markets, easing pressure on oil prices and reducing fears of a prolonged energy shock.

Global crude prices have surged sharply in recent sessions amid concerns that tensions involving Iran could disrupt supplies in the Middle East, a region critical to global oil flows. India, which imports more than 80% of its crude oil requirements, remains particularly sensitive to rising oil prices because they directly impact inflation, the rupee and fiscal balances.

The latest reports therefore triggered relief buying across risk assets, especially in Asian markets and equity futures.

On Monday, benchmark indices had witnessed extreme volatility before recovering losses toward the close. BSE Sensex ended 77 points higher at 75,315 after falling more than 1,100 points during intraday trade. Nifty 50 closed nearly flat at 23,650 after staging a late recovery.Vinod Nair, Head of Research at Geojit Investments, had said the prolonged US-Iran stalemate continued to cloud near-term market sentiment, while higher bond yields, elevated crude prices and rupee weakness reinforced inflation concerns.Hariprasad K, Research Analyst and Founder of Livelong Wealth, said markets witnessed aggressive short covering and selective value buying after the early panic selling phase.

He noted that export-oriented sectors such as information technology were increasingly being viewed as defensive allocations during periods of geopolitical uncertainty.

Analysts believe any diplomatic breakthrough involving Iran could reduce pressure on global crude prices and improve risk appetite across emerging markets including India. Brent crude had climbed above $110 per barrel during the previous session as investors feared possible disruptions to Middle East oil supplies.

Analysts said the market will continue to closely track developments around Iran-related negotiations because oil prices remain one of the biggest near-term risks for inflation and equity valuations globally.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)