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Informist, Monday, Mar. 23, 2026

 

By Arya S. Biju 

 

MUMBAI – The benchmark indices are expected to bounce back with a gap-up opening Tuesday after US President Donald Trump, after market hours Monday, said military strikes on Iran's power plants and energy infrastructure had been put off for five days following discussions between the two countries. Iran's foreign ministry, however, denied any talks with the US, saying there has been no dialogue between the antagonists. Market volatility is expected to remain high on the expiry day of the weekly derivatives contract of Nifty 50 amid the uncertain macroeconomic environment, analysts said. 

 

Over the past two days, the US and Iran have had "very good and productive conversations" regarding a complete and total resolution of hostilities in West Asia, Trump claimed in a post on Truth Social. However, Iran's semi-official Mehr news agency carried a statement from the foreign ministry saying there was no dialogue with the US, Al Jazeera reported. Trump's comments were aimed simply at lowering energy prices and buying time to implement his military plans, the ministry said in its statement. It added that there are "initiatives" by regional countries to reduce tensions, but that their concerns should be referred to the US, "the party that started this war".

 

Following Trump's comments, the May futures contract of Brent Crude plunged over 14% to $96 a barrel. However, it came off the low and was being traded at $101.61 per barrel at 1826 IST. The extent of the rise in the Nifty 50 will depend on where crude oil settles after the initial fall, Ajit Mishra, senior vice-president, research, at Religare Broking, said. 

Crude oil prices have been rising since the military conflict in West Asia began Feb. 28, surging over 40% so far. The Brent Crude futures contract had been consistently trading above $100 per barrel in the past seven sessions. Higher energy prices amid the continuing regional conflict had raised concern about higher inflation, which could prompt central banks to keep rates higher for longer, analysts said.

 

"Every 10% increase in oil prices could drive inflation (higher) by 30 (basis points)," a head of research at a large broking firm said. "So there will be upward pressure on inflation... pressure on current account deficit, there will be pressure on the INR (rupee). All these things will put pressure on the market. So if the inflation goes sustainably up in the coming months, there will be chances for a rate hike to come in." 

 

Analysts have also pointed out that higher energy prices could have an impact on the earnings of domestic companies in the coming quarters. "(With) the price of crude above $100 (per barrel) and all the West Asia disruptions, I am expecting up to 50-60 basis points impact on EBITDA (earnings before interest, taxes, depreciation, and amortisation) margins for overall FY27," Ram Kalyan Medury, founder and chief executive officer of Maxiom Wealth, said. 

Monday, the Nifty 50 settled at 22512.65, down 601.85 points or 2.6%. This marks the index's lowest closing level since April 2025. "We are kind of looking at a reasonable bottom right now," Medury said. "There could be a bounce from here in the coming days."

 

However, the head of research quoted earlier said a day's bounce-back rally would do nothing for the market's structure. "It needs to stabilise and go into some kind of consolidation mode," the research head said. "Then there could be a sustainable kind of bounce-back or ...uptrend. Till that time, we will not see any change in the broader narrative." 

 

The March futures contract of GIFT Nifty indicates a gap-up opening for the Nifty 50 Tuesday. At 1824 IST, the futures contract was at 23305 points, up nearly 800 points from the Nifty 50's Monday close.

 

Tuesday, the Nifty 50 is seen finding immediate support at 22000–21900 points, followed by 21700 points, Mishra said. "In case of a recovery, the 22800–23000 zone is likely to act as a strong resistance band," he said. "Given the prevailing uncertainty, elevated volatility, and continued global headwinds, participants are advised to prefer options spreads over naked positions in the index while maintaining a selective, stock-specific trading approach."  End

 

US$1 = INR 93.9750

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Rajeev Pai

 

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