Nifty, Sensex rebound on hopes of West Asia de-escalation, short covering

West Asia conflict could ease.The benchmark Nifty50 index recovered close to half of its recent losses in the last hour on Thursday, as reports emerged that Iran had reached out to the US for talks to end the war, improving risk appetite. The news coincided with the weekly expiry of Sensex options on Thursday, which also forced the traders to square off their positions in panic.The US and Israel launched joint strikes on Iran on Saturday that killed its supreme leader Ayatollah Ali Khamenei, triggering retaliation and fuelling a wider regional conflict in West Asia, dragging stock markets around the world lower.Over two trading sessions starting Monday, the Nifty50 had fallen 695 points, of which 285 points—about 41%—were recouped on Thursday.

Investors squared off short positions in the final hour of trading, helping the index close 1.17% higher at 24,756.90. The BSE Sensex also ended the session 1.14% higher at 80,015.90The markets were shut on Tuesday for a public holiday.Investors are expected to watch for de-escalation cues to gauge further market direction, experts said.“It would be premature to term this move as a reversal.

Given the sharp decline seen earlier, the current move should be treated as an initial retracement of the fall,” said Rajesh Bhosale, technical analyst at Angel One. On the upside, any sustained move above the 25,000–25,100 levels would be crucial to signal a meaningful reversal, Bhosale added.Since the short positions are already cut, if positive news emerges, the market could move up higher, considering the sharp fall seen in the past two days, said Rajesh Palviya, head of technical and fundamental research at Axis Securities.The Indian rupee also appreciated 0.59% to 91.6 per dollar, likely