Softening global crude oil prices amid easing geopolitical tensions in West Asia are expected to lift sentiment across oil-sensitive sectors such as oil marketing companies (OMCs), aviation, paints, and tyres. The positive sentiment was reflected in Wednesday’s trading with shares of Hindustan Petroleum Corporation (HPCL) surging nearly 4% and Indian Oil gaining over 1%
InterGlobe Aviation (IndiGo) was among the top gainers in the Nifty 50 pack, advancing more than 4% as investors bet on the benefits of easing crude oil prices for the aviation sector. The airline’s fuel expenses rose 67% to Rs 9,967 crore in Q2FY27 from Rs 5,962 crore in Q2FY26. Owing to this, it reported a consolidated net loss of Rs 1,879 crore in the recently concluded quarter.
“With Brent crude retreating toward US$90/bbl amid expectations of easing geopolitical tensions, the backdrop is turning structurally more favourable for India. OMCs are likely to be among the biggest direct beneficiaries, as lower crude eases losses on fuel and LPG sales, supports a recovery in marketing margins and strengthens earnings and cash flows,” said Arun Kailasan, Research Analyst, Geojit Investments.
Kailasan added that aviation, paints, tyres, plastics and packaging companies should also benefit from lower fuel and crude-linked input costs, with the gains extending to packaging-intensive FMCG players. Among major tyre companies, shares of Apollo Tyres, JK Tyres, MRF and Ceat rallied about 2% each. Paint major Asian Paints jumped 1.6% on the bourses, while Kansai Nerolac advanced 3% and IndiGo Paints zoomed more than 8%.
After falling below $90/bbl on Tuesday, Brent crude on Wednesday is trading around $93/bbl near two months low, offering meaningful relief to the Indian economy on the macroeconomic front. The rapid fall in oil prices during the past two weeks, combined with strong foreign institutional investor (FII) inflow, has helped Sensex and Nifty to advance more than 11% each in 10 sessions.
FIIs have pumped approximately Rs 71,000 crore into Indian equities over the past 15 sessions (excluding Thursday’s FII activity. The strong inflow helped the rupee to recoup its devaluation against the dollar.
Indian equities were off to a flier on Wednesday with the two benchmarks – NSE Nifty50 and BSE Sensex – surging over 1.5% each in early deals, but significantly pared their gains during the afternoon due to various reasons, including profit booking.
The Sensex rose 772.75 points or 0.95% to settle at 81,879.40, and the Nifty50 was up 210.40 points or 0.84% at 25,255.05. In the broader markets, the Nifty MidCap 100 and the Nifty SmallCap 100 rose 0.81% and 1.59%, respectively. Sector-wise, Nifty PSU Bank jumped the most at nearly 3%. The Nifty Bank, Nifty Private Bank and Nifty Auto also outperformed.
Vinod Nair, Head of Research, Geojit Investments, said that whether this renewed risk appetite holds will depend on upcoming India's October inflation and US PPI data, which together should shape the outlook for domestic prices and global interest rates.
Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services, said that Indian equities are likely to retain their positive momentum, supported by an improving earnings trajectory, a sharp correction in crude prices and a strong resurgence in foreign investors' flows. “While the sharp rally could invite intermittent profit booking, the combination of improving earnings, lower crude prices and renewed foreign participation provides a supportive backdrop for domestic equities,” added Khemka.