Sensex rebounds 1,800 points in just 2 days

Indian stock markets were up 2% today, extending the rally to the second day. The Nifty and Sensex finished 2% higher at 16,345 and 54,647 respectively, adding to the previous session's 1% gains.

European markets were sharply higher in early trade today while US stock futures also rose as investors monitored the Ukraine crisis and surging commodity prices.

There was a little support to risk assets from comments by Ukraine's President Volodymyr Zelensky who said he was no longer pressing for NATO membership, said IFA Global.

But analysts warned of further volatility as Russia showed no sign of letting up on its invasion of Ukraine. The crisis has fuelled fears that the fragile global recovery from Covid-19 will be replaced by a period of stagflation, in which inflation surges and economies flatline or contract.

Some analysts said that Indian markets were extremely oversold after the recent Ukraine selloff and a relief rally was due.

Investors will also be keeping an eye on recent state election results which will be announced tomorrow. Analysts say this may have a short-term impact, depending on the outcome.