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Indian shares advanced on Thursday as investors bought the dip after a sharp selloff triggered by renewed Middle East tensions, although lingering concerns over the conflict capped gains.
The benchmark Nifty 50 (.NSEI) rose 0.69% to 24,048.50, while the BSE Sensex (.BSESN) added 0.69% to 77,028.59, as of 10:26 a.m. IST.
The U.S. military launched fresh strikes on Iran on Wednesday to keep the Strait of Hormuz open, hours after President Donald Trump said an interim peace agreement was "over", sending crude prices surging to $79 a barrel.
Higher oil prices hurt oil importers like India by raising import costs, inflation risks, and pressure on growth and margins, dragging the benchmarks 2.1% on Wednesday, their biggest single-day drop in three months.
The partial recovery in India on Thursday was in line with gains seen in Asian markets, where chipmakers led advances despite the escalation in the Middle East.
"Today's bounce shows investors are willing to buy the dips, especially after Indian markets underperformed sharply in 2026 amid unprecedented foreign selling," said Samrat Dasgupta, CEO of Esquire Capital Investment Advisors.
"June-quarter earnings may underwhelm as crude bites, but commentary, U.S.-Iran peace signals and the monsoon will drive markets, with big dips likely to be bought if earnings show the resilience flagged in updates, especially by banks," Dasgupta said.
Fourteen of the 16 major sectors logged gains. The broader small-caps (.NIFSMCP100) and mid-caps (.NIFMDCP100) rose 1.5% and 1.2%, respectively.
Benchmark heavyweights HDFC Bank (HDBK.NS) rose 0.4% while ICICI Bank (ICBK.NS) and Reliance Industries (RELI.NS) led gains, rising 1.2% each after losing 2.2%-2.5% losses in the previous session. Banks (.NSEBANK) and financials (.NIFTYFIN) gained 0.8% and 0.5%, respectively.
Pharma (.NIPHARM) and healthcare stocks (.NIFHEIN) advanced 1.8% each as investors rotated into sectors seen as relatively insulated from crude price swings and monsoon risks.
The IT index (.NIFTYIT), however, fell 0.6%. The country's largest software exporter Tata Consultancy Services (TCS.NS) shed 1% ahead of June-quarter earnings, due after market hours.
