Sensex snaps four-day slide as bank stocks rebound, but crude near $115 caps the rally

Indian equities snapped a four-day losing streak on Monday, with the Nifty 50 closing 0.68% higher at 22,735 after an opening sell-off dragged the index as low as 22,387. The Sensex added 0.66% to end at 73,606, a 483-point gain, while broader markets outperformed: the Nifty Midcap 100 rose 1.38% and the Nifty Smallcap 100 gained 1.25%.

Financial stocks led the rebound. The Nifty Bank index, which had slipped to a four-month low, recovered as value buyers stepped in. Kotak Mahindra Bank was the top performer in the pack, rising 2.4%, with Union Bank of India, IndusInd Bank and Federal Bank each closing more than 1% higher. ICICI Bank and State Bank of India both rebounded about 2% from their lows.

Vinod Nair, head of research at Geojit Investments, attributed the recovery to value buying and strength in metals, power and healthcare, but said elevated crude prices, geopolitical uncertainty and caution ahead of policy decisions from the Fed, ECB and BoJ kept sentiment measured. Shrikant Chouhan of Kotak Neo said the benchmarks formed a bullish candle and a promising reversal pattern, with 22,600 and 22,500 now acting as key support for the Nifty.

Oil remains the swing factor. Brent crude eased towards $115 a barrel, retreating from multi-month highs despite concerns that strikes against Iran could resume after this week's Israeli elections and next week's US midterm elections. Hariselvan Radhakrishnan, founder and chief executive of HST Wealth, said a sustained retreat backed by geopolitical de-escalation could broaden the equity recovery, while another supply-driven rise would renew pressure on consumption-sensitive businesses. He also flagged the US 10-year Treasury yield near 4.99%, warning that a further rise in yields or the dollar could restrict foreign participation in Indian equities.