Indian shares join global rebound as Middle East worries ease

The Bombay Stock Exchange building is seen in Mumbai

By Bharath Rajeswaran and Manvi Pant

BENGALURU (Reuters) -Indian shares closed higher on Monday, tracking a rebound in global markets due to easing worries over the escalation of tensions in the Middle East.

The NSE Nifty 50 rose 0.86% to close at 22,336.40, while the S&P BSE Sensex ended 0.77% higher to 73,648.62.

The benchmarks lost about 1.6% last week due to the worries over the Middle East conflict and a delay in U.S. rate cuts.

Those worries pushed Asian shares down 3.7% last week. They gained 0.9% on Monday, while gold prices dipped as overall risk sentiment improved over the weekend. [MKTS/GLOB]

"There was no follow-through escalation in geopolitical tensions in the Middle East as Iran attempted to defuse tensions," OCBC analysts said in a note.

Wipro gained 2% after the software services provider reported a bigger-than-expected quarterly revenue.

State-run oil marketing companies Bharat Petroleum Corp, Hindustan Petroleum Corp and Indian Oil Corp, which rely on imported crude, gained 2.5%-3.5%, as oil prices eased. [O/R]

HDFC Bank, which has the highest weight on the Nifty 50 dropped 1.25% after reporting a smaller-than-expected quarterly profit due to higher provisions.

"After the profit-booking due to weak global cues last week, the upcoming key earnings and management commentaries will remain the key triggers for domestic markets," said Mohit Khanna, fund manager at Purnartha Investment Advisors.

Reliance Industries, the second-heaviest Nifty 50 stock, ended 0.78% higher. It is due to report after the bell.

The more domestically-focussed small- and mid-caps rose 1.31% and 0.82%, respectively.

"The sustainability of the rebound in small- and mid-caps in April is dependent on earnings growth," said Abhijit Bhave, managing director and chief executive of Equirus Wealth.

"The worst may not be over for the broader markets yet."

(Reporting by Bharath Rajeswaran and Manvi Pant in Bengaluru; Editing by Eileen Soreng, Sonia Cheema, Mrigank Dhaniwala and Savio D'Souza)