Indian shares are set for a positive opening on Monday, with analysts pointing to strong earnings from major private lenders HDFC Bank and ICICI Bank as key drivers. Currently, GIFT Nifty futures are trading at 24,469.50, signaling an upward trend compared to Friday’s closing figure of 24,353.55.
The significant performances by HDFC Bank and ICICI Bank, both of which reported higher-than-expected profits for the March quarter, have provided reassurance to investors amid ongoing global concerns. These results were fueled by robust loan growth, contributing to a broader market sentiment last week, where both the Nifty 50 and Sensex indices climbed by 1.3%, marking their second consecutive week of gains.
Despite this positive corporate news, analysts remain cautious. Hariprasad K, a market analyst, highlighted that while the earnings reports from HDFC Bank and ICICI Bank might stabilize the market, the overarching global sentiment is still fragile, particularly due to escalating tensions in the Middle East. These tensions could heighten concerns surrounding supply disruptions and inflation, further complicating the investment landscape.
Asian markets similarly showed gains, rising by 0.6%. However, Brent crude oil prices surged to $97 a barrel, attributed to the ongoing instability in the Middle East, which has severely hampered shipping activities through strategic waterways. Traders remain hopeful for a resolution even as uncertainty looms large.
The fragile ceasefire in the Iran conflict faces new challenges, particularly after the U.S. seized an Iranian cargo ship, prompting vows of retaliation from Iran. The situation has resulted in the reinstatement of Iran’s de facto closure of the Strait of Hormuz, coupled with a refusal to engage in new peace talks with the U.S.
On the investment front, foreign institutional investors continued to buy into domestic stocks for a third consecutive session on Friday, with recorded inflows of 6.83 billion rupees (approximately $74 million). In contrast, domestic institutional investors have been net sellers over the same period, with outflows amounting to 47.21 billion rupees.
Key stocks to monitor in the upcoming trading session include Yes Bank, which reported a higher profit in the March quarter on the back of improving loan growth and stable asset quality, while Jio Financial Services noted a decline in profit. Additionally, Cipla faces regulatory scrutiny with two Form-483 observations from the U.S. FDA following a routine inspection at its Goa manufacturing facility.
