The Sensex snapped its three-day losing streak, ending 650.39 points (0.79%) higher at 83,277.15, largely driven by buying in power, realty, and bank shares amid mixed global cues. The Nifty also broke its two-day losing run, gaining 211.65 points (0.83%) to close at 25,682.75.
Heavyweight Recovery
While the market ended positive, it opened with a negative gap following last week’s proposal by the Reserve Bank of India that restricted funding of banks to capital market players. After remaining subdued for the major part of trading session the benchmarks bounced back in the latter half on back of selective buying in index heavy-weights. Investor wealth rose by Rs 3.12 lakh crore to Rs 468.58 lakh crore, after eroding nearly Rs 10 lakh crore over the previous two sessions.
Siddharth Bhamre, Head of Institutional Research, Asit C Mehta Investment Intermediates, said, “The market’s uptick today is more of a technical rebound than a trendsetter. With foreign investor outflows still casting a shadow, equities are likely to drift sideways. Most of the good news is already priced in, and for the next decisive leg up, the FII overhang must ease. We have seen time correction, not a shift in sentiment—the market isn’t bearish, just waiting for a catalyst to break out of its range.”
Foreign portfolio investors sold shares worth Rs 972.13 crore, while domestic institutional investors purchased equities worth Rs 1,666.98 crore, as per provisional BSE data.
Market breadth remained negative, with 2,510 losers against 1,793 gainers on the BSE.
Broader indices underperformed the benchmarks, with the BSE Midcap rising 0.62% and the BSE Smallcap declining 0.40%.
India VIX edged up 0.28% to 13.33, indicating a marginal increase in near-term volatility.
Except for auto and consumer discretionary, all other sectoral indices ended in the green on the BSE. Power, realty, and banks were the top sectoral performers, rising by up to 2.40%.
“Last week’s weakness in the IT space weighed on sentiment, but the new week has begun on a stronger note, supported by renewed buying interest in the banking sector,” said Rajesh Bhosale, Technical Analyst at Angel One.
The power sector gained on expectations of sustained demand momentum, while improved loan growth and stable asset quality bolstered confidence in banks, said Vinod Nair, Head of Research at Geojit Investments.
Power Grid, HDFC Bank, Axis Bank, NTPC, and ITC were the top Sensex gainers, advancing by up to 4.45%.
HDFC Bank and Reliance Industries together contributed 350 points, or 54%, of the Sensex’s 650-point gain.
The Nifty IT Index rebounded on Monday after falling 8.5% over the previous three sessions amid concerns that artificial intelligence could disrupt tech companies’ business models. The index ended marginally higher by 0.17%, with all but two constituents closing in the green.
Regulatory Headwinds
Capital market-related stocks, however, plunged by up to 10% intraday after the RBI tightened rules on bank loans to proprietary traders and stockbrokers — a move expected to curb leveraged trading. BSE, Angel One, and MCX were among the top intraday losers.