Indian equity markets staged a strong recovery on Wednesday, snapping a two-day losing streak as positive corporate earnings spurred buying interest, particularly in auto and fast-moving consumer goods (FMCG) stocks. The Sensex closed roughly 600 points higher, while the Nifty 50 settled above the 24,150 mark, according to market data.
The rally, however, lost some steam in the latter half of the session as global headwinds returned to the forefront. Brent crude oil prices hovered near $111 a barrel, stoking concerns over India's import bill and inflationary pressures. Geopolitical tensions, particularly around the Strait of Hormuz, continued to weigh on investor sentiment, keeping traders on edge.
Foreign portfolio investors remained heavy sellers, with outflows from Indian equities surpassing $20 billion in the first four months of 2026. Data from the National Securities Depository showed that since the onset of the Iran conflict, nearly $19 billion has been pulled out of Indian markets, already exceeding last year's full-year record outflow.
The early session saw robust buying, with the Sensex surging as much as 1,028.75 points, or 1.34%, to an intraday high of 77,915.12. The Nifty followed suit, climbing 320.70 points, or 1.34%, to 24,315.40. Market breadth was positive, with 2,468 stocks advancing on the BSE against 1,635 decliners.
Auto stocks led the charge, with Maruti Suzuki India Ltd jumping 4.34% to ₹13,452, emerging as the top Nifty gainer. Mahindra & Mahindra Ltd, Eicher Motors Ltd, and other consumer-oriented stocks also posted gains. On an earnings call, Maruti Chairman R C Bhargava outlined a capex of approximately ₹14,000 crore for the current fiscal year, earmarked for new capacity at Kharkhoda and a planned site in Gujarat.
Earnings were the primary catalyst for individual stock moves. Shares of Eternal Ltd, which owns Zomato and Blinkit, surged after reporting a 346% year-on-year jump in consolidated fourth-quarter net profit to ₹174 crore. Maruti, despite a 7% decline in standalone profit for the March quarter, gained as analysts focused on its volume outlook and demand expectations.
As the afternoon wore on, traders pared positions amid lingering oil concerns. FMCG, IT, and auto stocks managed to hold onto gains, but consumer durables and media names slipped into the red. Banking shares traded without a clear direction, and broader market momentum faded, according to market reports.
V K Vijayakumar, chief investment strategist at Geojit Investments, urged caution, noting that the energy supply disruption near the Strait of Hormuz remains unresolved. "Brent crude at $110 is negative for India," he told the Economic Times. High crude prices, he warned, could pressure economic growth and elevate inflation risks.
The rupee weakened at the open, slipping 0.2% to 94.74 against the U.S. dollar, compared to Tuesday's close of 94.54. Investors also kept a close watch on the U.S. Federal Reserve's policy decision, expected later in the day.
Lilian Chovin, head of asset allocation at Coutts, highlighted that markets like India, which are heavily dependent on oil and food imports, remain vulnerable to the fallout from the Middle East conflict. Analysts at CLSA, led by Vikash Kumar Jain, noted that a sustained rally in Indian equities would require a return of foreign capital. For now, domestic earnings are providing support, but the market's next move hinges on crude oil prices, the rupee's trajectory, the Fed's stance, and whether foreign investors eventually halt their selling into rallies.
