Equity benchmarks extended their gains on Monday after closing out the previous session by logging their third straight weekly rise, defying a broader global stock market gloom, as a fall in oil prices, robust capital inflows and strengthening automobile stocks boosted investor sentiment.
The benchmark indexes on Friday had logged their third straight weekly gain, advancing 1.4% each.
“The price of crude staying below 95 and foreign investors buying Indian shares last week are mainly the two factors that are keeping us positive,” Neeraj Dewan, director at Quantum Securities, told Reuters.
Foreign investors have poured $1.79 billion into Indian equities so far this month, according to Refinitiv data.
Meanwhile, oil prices hovered near multi-month lows on Monday, as data pointed to a slow recovery in China’s crude imports in July.
That is good news for India, the world’s third largest importer of oil, as a fall in crude prices brings down imported inflation and eases the pressure on the domestic currency.
Still, the rupee weakened sharply on Monday, driven by a a re-energised dollar on bets for bigger-sized Fed rate hikes made their way back after solid US jobs data.
Indian markets will be closed on Tuesday for a holiday.