Benchmark equity indices opened on a positive note on Monday, lifted by improving corporate earnings and optimism around Q2 results.
At 9:18 am, the S&P BSE Sensex rose 87.27 points to 84,650.05, while the NSE Nifty50 gained 24.50 points to 25,934.55. Broader markets were mixed in early trade.
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said the Q2 earnings so far indicate a clear pickup in profitability. “Net profits have grown by 10.8%, the best in six quarters and a clear beat over earlier estimates,” he noted.
He expects earnings momentum to strengthen in Q3, driven by discretionary consumption. “Automobiles, in particular, will lead earnings growth in Q3. The sustainability of the current consumption boom post-festive season will be important to watch,” he added.
Vijayakumar cautioned that foreign inflows remain critical for markets to scale new highs. “A sustained uptrend has been elusive as FIIs continue to sell into rallies. A shift in FII strategy is essential for markets to break out to new record highs and stay there,” he said, adding that consistent earnings improvement from Q3 may help reverse this trend.
Prashanth Tapse, Senior VP (Research) at Mehta Equities, noted that Nifty logged five straight sessions of gains last week, while Bank Nifty rose for the sixth consecutive session. He attributed the positive sentiment to the NDA’s victory in Bihar, softer inflation at 0.25%, hopes of a US–India trade deal, resolution of the US shutdown and easing crude prices.
Despite FII selling of Rs 4,968.20 crore on Friday and Rs 13,652.70 crore so far this month, Tapse believes the index remains poised to test record levels. “The all-time high of 26,277.35 is within reach as long as Nifty holds above 25,600,” he said. Traders will also monitor this week’s FOMC Minutes for cues on the Fed’s stance. He sees buying opportunities in BEL, Sun Pharma and Nykaa on dips, with BEL as his preferred pick for short-term momentum.
Amruta Shinde, Technical and Derivative Analyst at Choice Equity Broking, advised traders to remain cautious amid global uncertainty. She recommended a selective buy-on-dips strategy with strict risk controls. “Fresh longs should be considered only above 26,100. Tight trailing stop-losses and partial profit-booking will be key,” she said, adding that global cues will remain crucial.
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