Indian equity markets extended their gaining streak for the second consecutive week, supported by broad-based buying, strong domestic macroeconomic indicators, easing geopolitical concerns, and optimism surrounding global trade developments. The benchmark indices remained resilient despite concerns over rising wholesale inflation and a delayed monsoon. Investor sentiment improved following the signing of the US-Iran Memorandum of Understanding (MoU), which significantly reduced geopolitical risks and eased concerns over global energy supplies. Strong export growth, healthy services activity, and positive expectations from the G7 Summit also supported market momentum. During the week, the Sensex advanced 1,274.95 points or 1.68% to close at 76,802.90, while the Nifty 50 gained 390.20 points or 1.65% to settle at 24,013.10. Broader markets outperformed, with the Midcap and Smallcap indices rising over 3%, reflecting improving risk appetite among investors. Technically, the Nifty support is placed around 23,800–23,300, while resistance is seen between 24,200–24,600. A sustained move above 24,600 could trigger fresh upside momentum.
Global markets ended the week on a positive note as easing geopolitical tensions and lower crude oil prices improved investor confidence. In the United States, the Federal Reserve kept interest rates unchanged at 3.50%-3.75%, although policymakers adopted a relatively hawkish tone by raising their 2026 inflation outlook and signaling the possibility of higher rates for longer. Despite this, US equities remained strong, supported by robust economic data, resilient consumer spending, and optimism around artificial intelligence-related investments. The S&P 500 gained 0.9% during the week, the Dow Jones Industrial Average rose 0.7%, while the Nasdaq Composite outperformed with a 2.4% gain, supported by strong buying in semiconductor and technology stocks. In Europe, inflation remained elevated, but labour market conditions improved. Across Asia, Japan continued to show economic strength with rising exports and higher interest rates, while China reported mixed data, with industrial production improving but retail consumption remaining weak. Overall, easing energy prices and reduced geopolitical risks helped support global risk assets.
The most significant global development during the week was the formal signing of the US-Iran Memorandum of Understanding (MoU) on 18 June, aimed at ending hostilities and ensuring uninterrupted passage through the Strait of Hormuz. The agreement significantly reduced fears of supply disruptions in global energy markets and marked a major de-escalation of geopolitical tensions that had dominated investor sentiment over the past several months. The reopening of the Strait of Hormuz, one of the world's most critical energy trade routes, improved visibility on global trade flows and reduced concerns regarding inflationary pressures stemming from elevated oil prices. Financial markets globally reacted positively, viewing the agreement as a step toward greater stability in the Middle East and reduced geopolitical risk premiums.
Crude oil emerged as one of the biggest beneficiaries of the geopolitical breakthrough. Brent crude settled at $79.95 per barrel, declining nearly 24% over the past month, as concerns regarding supply disruptions eased substantially following the US-Iran agreement. The sharp correction in oil prices provided relief to oil-importing economies such as India by reducing inflationary pressures, supporting currency stability, and lowering input costs for energy-intensive industries. Lower crude prices are also expected to positively impact India's trade deficit, current account balance, and corporate profitability across sectors such as aviation, paints, logistics, chemicals, and oil marketing companies. Going forward, crude oil price stability will remain a key factor influencing inflation expectations and monetary policy decisions globally.
India’s economic indicators continued to demonstrate resilience despite global uncertainties. Merchandise exports rose 18% year-on-year in May to $45.20 billion, while services exports increased to $36.76 billion, highlighting the strength of external demand. However, wholesale inflation accelerated sharply, with WPI rising to 9.68% in May from 8.30% in April, driven primarily by fuel, power, and manufactured product inflation. Food inflation also moved higher to 4.49%. Meanwhile, concerns around the monsoon intensified as rainfall remained 35% below normal as of mid-June, raising fears of higher food inflation and weaker agricultural output. RBI MPC minutes indicated that policymakers remain cautious due to global uncertainties, rising energy costs, and weather-related risks, while emphasizing that India's macroeconomic fundamentals remain among the strongest globally. The rupee strengthened to a six-week high following the decline in crude oil prices and easing geopolitical tensions.
Markets are expected to remain constructive, supported by lower crude oil prices, easing geopolitical tensions, and improving global risk sentiment. Technically, the Nifty support is placed around the 23,800–23,300 zone, while resistance is seen between 24,200–24,600 levels. A decisive breakout on either side is likely to determine the next directional move for the market. Investors will closely monitor India's Infrastructure Output data, HSBC Manufacturing, Services and Composite PMI readings, and forex reserve trends for further cues on domestic economic activity. Globally, key events include US PMI data, GDP figures, current account data, trade balance numbers, and China's Loan Prime Rate decision. The Federal Reserve's hawkish stance may keep global bond yields elevated, but lower energy prices are expected to offset some of these concerns. Corporate earnings guidance, monsoon progress, and FII flows will remain important near-term market drivers. If crude oil remains below $80 per barrel and domestic macroeconomic data remains supportive, Indian equities could continue their upward momentum with selective sectoral leadership. Investors should focus on sectors benefiting from lower crude oil prices, improving domestic demand, and strong earnings visibility while remaining watchful of inflation trends and global monetary policy developments.