Bulls showed no signs of loosening their grip on Dalal Street after a 7-session strong rally as benchmark indices BSE Sensex and NSE recovered around 1% from the day’s low and settled in the green on Monday. In the highly volatile session, the Sensex added 107.25 points, or 0.13% to close at 81,106.65 while the Nifty50 index closed 58.25 points, or 0.23% higher at 25,044.65.
In intraday deals, the Sensex had hit a low of 80,519.31 while Nifty fell as much as 24,838.75. The recovery from lows came despite concerns of profit booking after a stellar run.
Sentiments also received a boost as global brokerage firms - Citi and HSBC - turned bullish on India. While Citi raised its calendar year 2027-end Nifty50 target to 28,000 from 26,000, citing improving corporate earnings momentum, expectations of lower crude oil prices and potential FII inflows into Indian equities, HSBC upgraded the market to "overweight."
The upgrade by global brokerages came after the Nifty50 index climbed more than 10% across seven sessions, supported by record FII inflow and easing crude oil prices.
"Indian equities traded range-bound with a positive bias, as intermittent profit booking following the recent rally capped gains. Weakness in IT and metal stocks also weighed on the benchmarks,” said Vinod Nair, Head of Research, Geojit Investments.
Nair added that improving FII participation and better-than-expected corporate earnings have strengthened expectations of an upgrade to the FY27 earnings outlook, supporting market sentiment. In November, so far, foreign institutional investors (FIIs) bought aggressively in the Indian market with a net inflow of Rs 45,970 crores.
The sudden change in FII sentiment was triggered by the AI sell-off in the US and other AI markets such as South Korea, Taiwan and Japan.
Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services said that Indian equities are likely to consolidate in the near term. With markets closed on Tuesday, the direction on Wednesday will largely be driven by global cues.
“Several tailwinds, including a strong earnings outlook, lower crude oil prices and the prospect of slower AI-related capex globally, continue to support the market. Hopes of an end to the conflict involving Iran have led to a sharp correction in crude oil prices, while India’s limited exposure to the AI trade has shielded domestic stocks from the global technology sell-off,” added Khemka.
Brent crude declined nearly 16% last week and traded around US$98/bbl on Monday on easing concerns around the West Asia conflict. Crude oil prices have a direct influence on Indian financial markets because India imports roughly 85% of its crude oil needs.
“Brent crude hovered around $98 per barrel, while easing concerns over further escalation in West Asia offered some comfort. However, weakness in global technology stocks and uncertainty surrounding the broader geopolitical and economic outlook continued to warrant caution,” said Ajit Mishra, SVP – research, Religare Broking.
Sectoral performance was mixed on Monday with strong buying interest in Nifty PSU Banks, Pharma and Healthcare. SBI, Trent, and Nestle were the top gainers in the Nifty pack while Tata Steel, HCL and UltraTech were the top laggards. In the broader market, the Nifty Midcap index gained 0.55%, while the Nifty Smallcap index ended marginally higher by 0.10%.
