Benchmark stock market indices opened flat on Monday, after the RBI announced no rate cuts in its monetary policy committee announcements last week.
The S&P BSE Sensex was up 37.49 points to 81,746.61, while the NSE Nifty50 gained 21.45 points to 24,699.25 as of 9:25 AM.
Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said that the near-term trend of the market is mildly bullish and the leadership for the rally which has taken the Nifty up by 3.2% during the last fortnight has come from the leading banks, which are even now fairly valued, and have the potential to take the market forward.
The top gaining stocks were Larsen and Toubro (LT), which rose 1.69%, SBI Life Insurance with a 1.14% increase, HDFC Life gaining 0.86%, Kotak Mahindra Bank up 0.65%, and HDFC Bank increasing 0.58%.
On the downside, Hindustan Unilever declined 3.53%, Tata Consumer Products lost 3.48%, Britannia fell 1.93%, Nestle India dropped 1.75%, and Trent decreased 1.46%.
“The return of the FIIs is another positive which augurs well for the largecaps. The ongoing rally can take the Nifty Bank to new record highs, lifting the Nifty further up. However, the sustainability of the rally is doubtful since the slowing Indian economy will constrain the bulls, and the FIIs may again turn sellers since there is no valuation comfort in the market. The momentum in the US market is robust and in such a scenario the bulls cannot be overly optimistic. Rate cut by the Fed this month is now a foregone conclusion and this will keep the equity markets positive. The medium to long-term trend of the market is uncertain,” he added.
The Nifty Midcap 100 index gained 0.33%, while the Nifty Smallcap 100 index rose slightly by 0.02%. The India VIX, which measures market volatility, saw an increase of 2.97%.