Indian equity markets are likely to begin Tuesday’s session on a stronger footing, with early signals from GIFT Nifty suggesting a recovery after Monday’s sharp decline. The derivative indicator was trading near 24,412.50 in early trade, implying a positive opening for the Nifty 50 benchmark.

The expected rebound comes after a volatile trading session where geopolitical tensions and rising crude prices triggered a broad selloff across Indian equities. Benchmarks had closed sharply lower, reflecting investor caution amid global uncertainty.

In the previous session, the Sensex ended at 77,566.16, falling 1,352.74 points or 1.71 percent. During intraday trade it had dropped to a low of 76,424.55 before partially recovering toward the close. The Nifty 50 followed a similar trajectory, slipping 422.40 points or 1.73 percent to settle at 24,028.05 after touching a day’s low of 23,697.80.

A key factor behind the selloff was the sudden surge in crude oil prices, which registered their biggest jump since 2020 amid fears that escalating conflict in the Middle East could disrupt global energy supply chains. For India, a large crude importer, such spikes quickly translate into macroeconomic concerns including higher inflation, currency pressure and potential widening of the current account deficit.

However, sentiment improved globally after comments from U.S. President Donald Trump suggesting that the conflict involving Iran could be nearing an end. According to remarks reported by international media outlets the U.S. administration indicated that military developments may soon stabilise, easing concerns of a prolonged disruption in oil supply.

The shift in geopolitical tone triggered a recovery across global markets. Asian equities rebounded in early Tuesday trade after heavy losses earlier in the week, supported by falling crude oil prices and renewed risk appetite.

Wall Street also staged a late-session recovery on Monday. The Dow Jones Industrial Average gained 239.25 points, or 0.50 percent, closing at 47,740.80. The S&P 500 rose 0.83 percent to 6,795.99, while the Nasdaq Composite climbed 1.38 percent to 22,695.95. The rebound came in the final trading hour after geopolitical tensions appeared to ease.

Currency and commodity markets also reflected this shift in sentiment. The U.S. dollar weakened in late New York trading, while commodity-linked currencies such as the Australian and New Zealand dollars strengthened against the greenback.

At the same time, U.S. Treasury yields moved slightly higher, with the benchmark 10-year yield rising above 4.1 percent. The two-year yield also edged up to around 3.55 percent, reflecting ongoing expectations that U.S. interest rates could remain elevated.

In Asia, currency movements were mixed. The Malaysian ringgit led gains among regional currencies, followed by the Philippine peso, South Korean won and Taiwan dollar. Such mixed moves highlight the continuing uncertainty in global capital flows amid geopolitical developments.

Commodity markets also signalled a cooling of risk fears. Oil prices retreated after surging to their highest level in more than three years during the previous session. The decline was largely driven by expectations that the Middle East conflict might not escalate further.

Gold prices, however, remained firm as investors continued to maintain defensive allocations. The precious metal tends to attract safe-haven demand during periods of geopolitical tension and currency volatility.

From a domestic perspective, institutional flows remain a key driver of short-term market direction. Foreign Institutional Investors (FIIs) extended their selling streak for the seventh consecutive session on March 9, offloading equities worth ₹6,345 crore. Persistent foreign outflows have been a major overhang for Indian markets in recent weeks.

In contrast, Domestic Institutional Investors (DIIs) provided support by purchasing shares worth around ₹9,000 crore during the same session. This continued domestic buying has played a stabilising role, preventing deeper corrections in benchmark indices.

The tug-of-war between foreign selling and domestic institutional buying has become a defining feature of recent market behaviour. While global funds remain cautious due to geopolitical risks and currency movements, local investors appear more comfortable accumulating stocks at lower levels.