Indian equity markets staged a strong recovery on March 5, 2026, with benchmark indices rebounding after the sharp sell-off seen over the past few sessions. Improved global sentiment and reports of possible diplomatic easing in the Middle East helped restore investor confidence.
The recovery follows a period of weakness during which Indian markets had declined nearly 4% across the previous three trading sessions amid concerns linked to the US-Iran conflict.
Index performance
Sensex gained 899.71 points (1.14%) to close at 80,015.90.
Nifty 50 advanced 285.40 points (1.17%) to settle at 24,765.90.
Nifty Bank rose 300.60 points (0.51%) to 59,055.85.
Nifty IT slipped 178.45 points (0.59%) to 30,126.80.
Market sentiment and volatility
Investor anxiety eased considerably during the session. India VIX, often referred to as the market’s “fear gauge,” declined sharply by 11.63% to 18.68, signalling a notable drop in near-term market volatility expectations.
The fall in volatility came alongside a broad improvement in global risk sentiment.
What supported the rebound?
Easing geopolitical tensions
Investor confidence strengthened after reports pointed to possible diplomatic de-escalation in the Middle East. Indications that Iran may consider stepping back from its nuclear programme under certain US conditions helped lift global risk appetite and supported equity markets.
Oil price movements
Brent crude continued to trade above $84 per barrel due to supply concerns. However, hopes that geopolitical tensions may cool helped ease fears of prolonged disruption in energy markets, allowing equities to stabilise.
RBI policy stance
The Reserve Bank of India kept the repo rate unchanged at 5.25%, signalling a continued pause in policy tightening. Policymakers maintained a neutral stance as domestic inflation remains within the target range while supporting economic growth.
Sectoral trends
Sectoral participation was broad during the recovery.
The Nifty Metal index emerged as the top performer, surging more than 3% during the session.
Auto, oil & gas, pharma, realty and banking indices also registered gains.
Energy stocks contributed significantly to the rally, with buying interest in Reliance Industries and ONGC helping push oil and gas indices higher.
However, IT stocks remained under pressure, making the Nifty IT index the only major sector to close lower.
Commodities and currency
Gold (MCX April 2 contract) traded largely flat at ₹1,61,540, up ₹15 (0.01%).
Silver (MCX March 5 contract) was quoted at ₹2,61,506, rising ₹116 (0.04%).
The Indian rupee also recovered from its previous session’s record low. The currency was trading near ₹91.57 per US dollar, rebounding after weakening to ₹92.17 in the prior session.
Market takeaway
Thursday’s session reflects a relief rally following the sharp correction seen earlier this week. Improved global cues, easing geopolitical concerns, and supportive monetary policy helped revive buying interest across sectors.
However, with crude oil prices still elevated and geopolitical developments evolving, market sentiment may remain sensitive to global triggers in the near term.
Source: Livemint, Moneycontrol, Google Finance
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