Benchmark indices gained nearly 1% on Monday, in line with other Asian peers, starting the holiday-shortened week on a strong note and almost fully recovering Friday’s losses on positive global cues.
Global and Domestic Factors Fuel the Rally
Indices rebounded after six consecutive weeks of decline, with the Sensex jumping 746.29 points, or 0.93%, to 80,604.08, and the Nifty rising 221.75 points, or 0.91%, to 24,585.05, as news of peace talks between Russia and the US later this week boosted market sentiment.
In Asia, apart from India, equity markets in Japan, Taiwan, Hong Kong, China, Malaysia, and Indonesia gained up to 1.85%, while those in the Philippines, Singapore, and South Korea fell by up to 1.34%. US equity markets hit record highs on Friday, while European indices ended mixed.
Analyst Outlook: A Cautious Recovery
“Global market sentiment improved following reports of US–Russia peace talks likely to be held this week, while Indian investors cheered FII inflows of ₹1,933 crore on Friday,” said Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services. Public sector banks saw strong buying interest after SBI posted better-than-expected Q1 results, he added.
Ajit Mishra, SVP of Research at Religare Broking, noted that in recent weeks, the Nifty has often started the week strongly only for momentum to fade by the close. This time, however, markets appear to have digested recent tariff-related concerns and are focusing more on earnings cues as the results season nears its end. Oversold positions in heavyweights are also providing support. “Still, only a decisive close above the 24,600 mark could extend this recovery towards the 24,800–25,000 zone,” he said.
After four sessions of weakness, market breadth turned positive on Monday, with 2,252 gainers against 1,912 losers on the BSE.
The broader indices, the BSE Midcap and BSE Smallcap, gained 0.79% and 0.35% respectively, but still underperformed the benchmarks. Barring consumer durables, all major sectoral indices ended in the green, led by the PSU Bank index, which rose over 2%. Realty, auto, and healthcare were the other top sectoral gainers.
Investor wealth surged by ₹3.5 lakh crore to ₹444.13 lakh crore. Domestic institutional investors continued their buying spree, purchasing shares worth ₹5,972.36 crore, while foreign portfolio investors sold shares worth ₹1,202.65 crore, according to provisional BSE data.