Markets rebound after two-day slide on DII support, heavyweight gains

Business Standard

8 hours ago

Snapping their two-day losing streak, benchmark indices rose on Monday, driven by gains in banking and technology heavyweights, shrugging off the Iran-Israel conflict. Continued buying by domestic institutional investors (DIIs) also helped underpin gains.
Most global markets also ended positive, stoking concerns that traders may be undermining the implications of West Asia tensions.
The BSE Sensex closed the session at 81,796, up 678 points or 0.8 per cent, while the NSE Nifty rose to 24,947, gaining 228 points or 0.9 per cent. The total market capitalisation of BSE-listed firms increased by ₹3.3 trillion, reaching ₹451 trillion.
DIIs were net buyers of equities worth ₹5,781 crore, while foreign institutional investors (FIIs) sold shares worth ₹2,539 crore. DIIs have been net buyers for 20 consecutive sessions, purchasing shares worth ₹94,500 crore. This marks the longest buying spree since the 29-day period of continuous buying that ended on March 19.
Despite ongoing attacks between Iran and Israel, crude oil prices stabilised as oil production facilities remained unaffected. The conflict has not yet led to the blockade of the Strait of Hormuz, which handles approximately one-fifth of the world's daily crude shipments. Brent crude was trading below $74, down 1.9 per cent. Gold prices declined by 0.5 per cent, trading at $3,413 per ounce. Analysts expect investors to continue their "buying the dip" approach as long as the conflict does not escalate further and other countries remain uninvolved.
"Despite ongoing geopolitical tensions between Israel and Iran, the market moved higher, supported by gains in largecap stocks. Investors maintained their focus on long-term fundamentals amid volatile conditions. Geopolitical developments in West Asia are likely to influence near-term market sentiment, with any signs of de-escalation being closely monitored. Smallcap stocks are expected to underperform in the short term, given their elevated valuations and lack of short-term catalysts," said Vinod Nair, Head of Research at Geojit Financial Services.
The market breadth was weak, with 2,151 stocks declining and 1,944 advancing. All but three Sensex stocks gained. Reliance Industries rose 0.76 per cent, and Bharti Airtel gained 1.04 per cent, contributing significantly to Sensex's gains.
Tata Motors fell 3.8 per cent — most among Sensex and Nifty components -- after projecting financial year 2026 operating margins of 5 per cent-7 per cent for its luxury unit JLR, below its earlier target of 10 per cent.
"The market's resilience amid lingering geopolitical tensions is encouraging. However, participants should remain cautious and not get carried away by a single-day rebound, especially as the index approaches the upper band of its current consolidation range, i.e., the 25,000–25,200 zone. We recommend maintaining a stock-specific trading approach, given the mixed trends across sectors, with a preference for relatively less volatile counters," said Ajit Mishra, SVP of Research at Religare Broking.