Benchmark indices opened sharply higher on Monday, outperforming their Asian peers as a steep fall in crude oil prices boosted investor sentiment, while continued foreign institutional investor (FII) buying and improving domestic fundamentals kept the bulls firmly in control.
At 9:47 am, the BSE Sensex was up 522.59 points, or 0.67%, at 78,617.23, while the NSE Nifty50 gained 163.90 points, or 0.67%, to trade at 24,547.50.
The rally came after Brent crude tumbled nearly 5% to around $83.5 a barrel as hopes of easing tensions in the Middle East improved after US President Donald Trump said talks with Iran would take place on Monday. Lower crude prices are a positive for India, which imports nearly 85% of its crude oil requirements, as they help ease inflationary pressures and reduce import costs.
BROAD-BASED BUYING LIFTS MARKETS
Buying was broad-based, with 14 of the 16 major sectoral indices trading in the green.
PSU Bank stocks led the gains, with the index rising 1.70%, followed by FMCG (1.48%), Chemicals (1.23%), Financial Services Ex-Bank (1.02%), Metal (0.94%), Financial Services (0.83%), Private Bank (0.75%) and IT (0.65%). Media was the biggest laggard, falling 1.97%, while Pharma slipped 0.19%.
Among the broader markets, the Nifty Smallcap 100 gained 1%, while the Nifty 500 rose 0.71%. The Nifty 100, Nifty 200, Midcap 100 and Midcap Financial Services also traded firmly in positive territory. India VIX edged up 0.36% to 11.80.
On the Sensex, ITC emerged as the top gainer, rising 3.68%, followed by IndiGo, which climbed 2.50%. SBI gained 1.84%, Bajaj Finserv rose 1.79%, Infosys advanced 1.64% and Bajaj Finance added 1.60%. TCS, Axis Bank, Asian Paints, Larsen & Toubro and ICICI Bank also traded with healthy gains.
On the losing side, Sun Pharma slipped 2.08%, Maruti Suzuki fell 1.75%, Eternal declined 0.69% and Bharti Airtel lost 0.33%.
ADVANTAGE BULLS
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, believes the market is well placed for a breakout above the 24,500 level on the Nifty.
“The market is set for a breakout above 24,500 Nifty and has the potential to sustain above that level. The decline in Brent crude to below $84, the good progress in monsoon in July and FIIs turning buyers are positive triggers for the market,” he said.
According to Vijayakumar, India’s economic resilience continues to stand out despite multiple global headwinds.
“A significant trend in the economy is that growth has been resilient despite the many headwinds. Better-than-expected credit growth, now running above 18%, sustaining auto sales and better-than-expected Q1 earnings indicate that FY27 earnings growth could surprise on the upside,” he said.
He added that stabilisation in the rupee, supported by inflows through FCNR(B), ECB and OFCB routes, has helped revive foreign investor interest.
“Good inflows through these routes have contributed to stabilising the rupee, which, in turn, is facilitating an FII comeback. In brief, it is advantage bulls,” Vijayakumar said.
