Mumbai, May 19 (IANS): Domestic equity markets traded higher in early trade on Tuesday after US President Donald Trump indicated a possible nuclear deal with Iran, raising hopes of a de-escalation in the West Asia conflict and providing relief to markets battered by weeks of geopolitical uncertainty. The Sensex rose as much as 368 points or 0.48 per cent to hit an intraday high of 75,683, while the Nifty was trading at 23,758, up 110 points or 0.45 per cent. IT stocks led the sectoral gains with the Nifty IT index surging 4 per cent, followed by the Nifty MidSmall IT and Telecom index advancing nearly 3 per cent and the Nifty Chemicals index rising 1.16 per cent. Among laggards, the Nifty Private Bank index slipped 0.11 per cent, while Nifty Auto and Nifty Metal indices also traded marginally lower, with Hindalco Industries, Coal India, and ONGC among the top decliners from the Nifty pack.
Markets found support after Trump said he had paused a planned attack on Iran following a peace proposal from Tehran and that there was a “very good chance” of reaching a deal on Iran’s nuclear programme, helping ease concerns over prolonged energy supply disruptions. Oil prices responded positively to the development, with Brent crude declining 2.74 per cent to $109.02 per barrel and US WTI crude trading 2.16 per cent lower at $102.12 per barrel. Analysts noted that fourth quarter earnings were encouraging and in many cases better than expected, signalling early signs of economic recovery from last year’s fiscal and monetary stimulus before the latest energy shock hit. Experts advised investors to focus on sectors relatively insulated from growth, inflation, and currency depreciation headwinds, including pharmaceuticals, power-related companies, and defence stocks, while also noting that a quick resolution of the Strait of Hormuz crisis could help the economy recover faster and limit the extent of the slowdown expected this year.