Sensex, Nifty trade higher as hopes of US-Iran deal lift market sentiment

Indian equity markets traded higher as hopes of a US-Iran peace deal boosted investor sentiment. Sensex and Nifty gained in early trade despite volatility in crude oil prices, while analysts warned about elevated AI-sector valuations and continued uncertainty surrounding the West Asia geopolitical crisis

Mumbai: The Indian equity markets traded higher on Thursday in morning trade amid hopes of the US-Iran peace deal. Sensex climbed as much as 0.48 per cent, or 380 points, to hit an intraday high of 78,339.24 in early trade, while Nifty traded at 24,423.35, up 0.37 per cent or 92 points.

Meanwhile, from the Nifty pack, Tata Consumer, Power Grid, Hindustan Unilever, TCS, HDFC Bank, Titan, NTPC, and Sun Pharma were among the top losers. Sectoral indices — Nifty Realty, Nifty FMCG, Nifty Consumer Durables, and Nifty Private Bank — declined up to 0.7 per cent.

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In contrast, Nifty Auto and Nifty Metal gained up to 0.78 per cent. Market sentiment turned positive after Iran said it is examining a US peace proposal, which, according to sources, would formally end the conflict while leaving unresolved key US demands for Tehran to halt its nuclear programme and reopen the Strait of Hormuz.

Market experts said that rising concentration risk in the AI segment, warning that valuations have reached elevated levels and a sharp correction cannot be ruled out.

According to them, a reversal in FPI flows into India may depend on any cooling in the AI trade or a correction in AI-related valuations. On geopolitical developments, they said the West Asia situation continues to be volatile, leading to a see-saw movement in crude oil prices. They further added that markets are currently swinging between hope and fear, and this trend may persist until there is greater clarity on the crisis. On earnings, market is rewarding strong Q4 results while punishing misses, with positive performance trends seen across market capitalisations, according to them.

Reports suggested that an Iranian foreign ministry spokesperson said Tehran would communicate its response to the proposal.

Meanwhile, US President Donald Trump said he believes Iran is interested in reaching an agreement. In commodities, the international oil benchmark Brent crude was trading at $102.50 per barrel, up 1.21 per cent, while US West Texas Intermediate (WTI) was trading 1.47 per cent higher at $96.48.

In Asian markets, major indices — the Nikkei, Hang Seng, and KOSPI — were trading up to around 6 per cent higher. Similarly, in the US markets, Wall Street ended higher, with the S&P closing 1.46 per cent up and the Nasdaq settling 2 per cent higher.