The Bombay Stock Exchange in India saw significant growth on Monday following a drop in oil prices and improved market sentiment. The Sensex rose by over 400 points, reaching 74,718.49, while Nifty also increased by 29.75 points, reaching 23,376.15.
Positive Market Performance
The Sensex started trading at 74,535.18 points and later climbed to 74,718.49 points, indicating an increase of 423.53 points or 0.57 percent compared to the previous close. Meanwhile, Nifty also rose by 29.75 points, reaching 23,376.15 points.
In various sectors of the market, Nifty Realty was recognized as the main winner, increasing by more than one percent. In contrast, the IT, media, metals, public sector banks, and financial services sectors were in negative territory. Overall, most market indices were in a negative state.
Impact of Oil Price Drop on the Market
The drop in oil prices continued for the fourth consecutive day, with Brent crude reaching $101 per barrel, down from Friday's close of $103.87. This decline follows the potential for diplomatic contacts between the United States and Iran at the United Nations and improved flows from the Strait of Hormuz.
At the time of reporting, Brent crude was trading at approximately $101.61 per barrel, and crude oil at $98.09 per barrel. Similarly, gold prices also declined on Monday, reaching around $4,367.88.
Anandia Banerjee from Kotak Securities noted that Aramco has sold about 60 million barrels of oil for September and October, leading to an increase in exports from Gulf countries to 1 to 1.5 million barrels per day. Additionally, Saudi shipments from the Strait of Hormuz in the first half of September exceeded 2 million barrels per day, which is about 1 million barrels per day more than in August.
Market Forecasts
Vipin Dikhna, a market analyst, stated that the Indian market started the week cautiously and relatively stable. The sharp drop in oil prices is seen as a positive driver for the Indian market. If oil prices continue to decline and foreign selling does not significantly increase, this could benefit domestic stocks.
Technically, 23,400 is recognized as an immediate barrier for Nifty. A sustained break above 23,400 could lead the index towards 23,500 to 23,600, while 23,200 is considered the first support and 23,100 to 23,070 as a strong support area.
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