The Sensex and Nifty rallied sharply on Friday amid optimism over a potential Iran-US agreement, with metal, realty and banking stocks leading the gains.

 Indian benchmark equity indices witnessed a strong rally in early trade on Friday, with the Sensex gaining nearly 1,000 points and the Nifty advancing more than 300 points, supported by broad-based buying across sectors and improved global sentiment.

At around midday, the BSE Sensex was trading near 74,800, up about 1.38%, while the NSE Nifty climbed to around 23,450, registering gains of roughly 1.25%. Realty, metal and banking counters emerged as the top performers during the session as investors returned to risk assets.

Market participants attributed the sharp upmove largely to easing geopolitical concerns after reports of progress in discussions between the United States and Iran. Investor sentiment improved after US President Donald Trump claimed that Iran’s Supreme Leader Mojtaba Khamenei had approved a new framework under which Iran would not pursue nuclear weapons and the strategically important Strait of Hormuz could remain open.

While Iranian authorities had not officially confirmed the claim, the development appeared to reassure global markets. Any reduction in tensions surrounding the Strait of Hormuz, a key route for global oil shipments, is generally viewed positively by investors due to its implications for energy prices and international trade.

Global cues support rally

Asian markets traded firmly in positive territory, adding momentum to Indian equities. South Korea’s Kospi index posted the strongest gains among major regional markets, rising more than 8%. Japan’s Nikkei also recorded a robust advance of over 3%, while Hong Kong’s Hang Seng gained nearly 2%.

The upbeat trend followed a strong overnight performance on Wall Street. The Dow Jones Industrial Average ended higher by 930 points, while the Nasdaq Composite and S&P 500 gained 2.54% and 1.75%, respectively.

Analysts said the combination of easing geopolitical concerns and positive global market cues encouraged fresh buying in domestic equities.

Sectoral buying visible

Buying interest was visible across several sectors, though metal, realty and banking stocks led the advance. Investors appeared to favour cyclical sectors that tend to benefit from stronger economic expectations and improved market confidence.

Broader market participation also remained healthy, indicating that gains were not limited to a handful of heavyweight stocks.

Foreign investors remain cautious

Despite Friday’s rally, foreign institutional investors (FIIs) continued to remain net sellers. According to provisional market data, FIIs and foreign portfolio investors sold shares worth ₹1,987 crore in the previous session.

Domestic institutional investors (DIIs), however, continued to provide support to the market. They purchased equities worth ₹4,225 crore on Thursday, extending their recent buying trend. Over the past month, domestic investors have remained significant net buyers, helping cushion the impact of foreign outflows.

Previous session saw volatility

The sharp gains on Friday came a day after a volatile trading session. On June 11, the Sensex had initially moved higher and touched an intraday high of 74,394 before witnessing heavy selling pressure in the afternoon.

The index eventually closed at 73,833, down from its day’s peak by more than 560 points. The Nifty settled at 23,162, losing 53 points. Information technology and banking stocks were among the major laggards in Thursday’s trade.

Focus on global developments

Market experts said investors will continue to monitor international developments, particularly any official confirmation regarding the reported Iran-US understanding. Global crude oil prices, foreign fund flows and upcoming economic indicators are also expected to influence market direction in the near term.

For now, Friday’s rally has helped the Sensex and Nifty recover from the previous session’s weakness, with investors taking comfort from improving global risk sentiment and strong buying in key sectors.