The Sensex and Nifty made strong gains in early morning trade on Wednesday as oil and gas explorers rallied on supply concerns, while a red-hot inflation reading for March fuelled expectations for an interest rate hike in June.
India’s retail inflation accelerated to near 7 per cent year-on-year in March, its highest in 17 months and above the upper limit of the central bank’s tolerance band for a third straight month.
The NSE Nifty 50 index was up 0.57 per cent or 100.30 points at 17,630.60, while the S&P BSE Sensex 0.53 per cent or 313.25 points to 58,889.62.
Top explorer Oil & Natural Gas Corp, Oil India and GAIL India were top gainers, rising 1 per cent to 3 per cent. Surging demand for coal also lifted top miner Coal India by 1.6 per cent.
Oil prices climbed on worries that sliding output in sanctions-hit Russia, the world’s second-biggest oil exporter, will tighten supply after Moscow said peace talks to resolve its invasion of Ukraine had come to a dead end.
Meanwhile, Asian shares firmed, boosted by US inflation figures that fared better than markets’ worst expectations – and caused US yields to pause their march higher.