New Delhi, April 9 -- India's stock markets erupted in relief after the US-Iran ceasefire, but is this the start of a sustained rally or just a pause in the storm? The Nifty 50 and S&P BSE Sensex surged nearly 4%, marking their strongest single-day gains in months, while volatility cooled sharply and Rs.16 lakh crore was added to market value.

At first glance, the mood feels upbeat. Lower immediate geopolitical risk and the Reserve Bank of India holding the repo rate steady added to the optimism. Even global markets joined the rally.

But the ceasefire is temporary. Oil prices, though off highs, remain elevated, and damage to energy infrastructure could keep supply tight. Add slowing earnings growth and persistent FII outflows, the under...