Indices reverse eight-day losing streak; Sensex ends 58 points higher

Indian equity benchmarks reversed their eight-day losing streak on Monday, driven by buying interest in heavyweight stocks such as HDFC Bank and Reliance Industries.

 

The Sensex, after declining by 645 points during the day, recovered to close at 75,997, marking a gain of 58 points, or 0.08 per cent, over Friday’s close.

 

Similarly, the Nifty ended the session at 22,960, up 30 points, or 0.1 per cent.

 

On Friday, the Nifty 50 and Sensex had closed at their lowest levels since January 27, nearing eight-month lows, after an eight-session losing streak-- the longest in two years. 

 

Indian equity markets have been under pressure since October, with investors offloading shares amid slowing corporate earnings growth, stretched valuations, concerns over US trade policy shifts, and persistent selling by foreign investors. 

 

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On Monday, foreign portfolio investors (FPIs) sold shares worth nearly Rs 4,000 crore, while domestic institutions were net buyers, purchasing shares worth Rs 4,760 crore. 

 

“Modest earnings growth in Q3FY25, coupled with sustained FPI selling, is limiting the potential for a near-term market rebound. A weakening rupee and a widening trade deficit are likely to heighten investor caution. Despite a sharp correction in broader indices, valuations remain unappealing. However, any easing of US trade uncertainties and initial signs of recovery in discretionary spending could support a market rebound,” said Vinod Nair, Head of Research at Geojit Financial Services. 

 

The Sensex’s gains were largely driven by HDFC Bank, which rose 1.3 per cent, and Reliance Industries, which gained 0.6 per cent. The broader market also saw modest gains, with the Nifty Midcap 100 and Nifty Smallcap 100 rising by 0.4 per cent and 0.04 per cent, respectively. However, market breadth remained weak, with 1,292 stocks advancing and 2,799 declining. The total market capitalisation of BSE-listed firms increased by Rs 12,852 crore. Meanwhile, market volatility rose, with the India VIX climbing 4.7 per cent to close at 15.7. 

 

“The resilience in key sectors like banking and IT, combined with oversold positions in other sectors, is prompting an intermediate recovery. However, the lack of sustainability is keeping traders cautious. We recommend continuing with a stock-specific approach, focusing on risk management. Preference should be given to large-cap and larger midcap stocks for long trades,” said Ajit Mishra, SVP of Research at Religare Broking.