The equity benchmark indices traded higher on Monday, tracking firm global cues and strong buying in banking shares.
At around 11:15 a.m., Sensex climbed 398.88 points or 0.49 percent to 81,606.05, while the broader Nifty advanced to 25,013.55, up 119.30 points or 0.48 percent.
Max Healthcare, Shriram Finance, Apollo Hospitals Enterprise, Axis Bank and Bajaj Finance were among top gainers, rising up to 5 percent intraday.
Key factors driving the market
1) Buying in bank stocks: Bank Nifty index advanced for the 5th straight session on Monday, propelled by strong buying in the bank stocks after strong second quarter business updates from HDFC Bank and Kotak Mahindra Bank. All the 12 constituents of the bank Nifty were trading in the green as the Bank Nifty index extended its rise by rising 450 pts (0.8%) to reclaim the 56,000-mark, rising up to 3 percent during the period.
“The quarterly business updates from public sector banks and non-bank lenders have been strong, while private sector banks too were largely in line,” Dharmesh Kant, Head of Equity Research at Cholamandalam Securities told Reuters. “Overall, this will keep sentiments on the positive side going into the earnings season,” he added.
2) Positive global cues: Major Asian markets traded in the green, with Japan’s Nikkei 225 index sharply higher. Wall Street futures were also up by around 0.4 percent, indicating a firm start for US equities today.
3) Rupee movement: The rupee appreciated by five paise to 88.74 against the US dollar in early trade, supported by a positive trend in domestic equities and likely IPO-related inflows. Analysts said the rupee’s firm tone reflects improving risk sentiment, which in turn supports foreign investor confidence in local markets.
4) Buying it IT shares: Strong buying it IT shares was also witnessed in today’s session which helped the overall market sentiment. All the 10 constituents of the Nifty IT index were trading in the green with the index rising 1.6 percent.
Technical view
According to Anand James, Chief Market Strategist at Geojit Financial Services, “Nifty is within touching distance of the 24,970–25,050 objective aimed for early last week. Oscillators remain accommodative towards extending this target. However, we do not see enough conditions to stretch beyond 25,200 right away.” He added that initial upswings could be played with downside markers placed near 24,835 or 24,700.
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