Indian shares erased early losses to rise on Monday, as bank and automobile stocks gained, while investors looked to corporate earning updates for further direction in the backdrop of weak global cues.
The NSE Nifty 50 index (.NSEI) was 0.52% higher at 17,275.45 as of 0510 GMT, and the S&P BSE Sensex (.BSESN) advanced 0.56% to 58,244.997.
"Rallies triggered by market positioning will be temporary because there won't be any follow-on fundamental support for the rally," said V K Vijayakumar, chief investment strategist at Geojit Financial Services. "There are no major triggers to take the market much higher at least in the near-term. There are no major triggers for a crash also since almost all negative factors are known to the market."
Strong flows into domestic mutual funds and optimism from retail investors could lend some stability, even as strong dollar and high bond yields in U.S. may nudge foreign investors to sell, Vijayakumar said.
Foreign institutional investors sold net 10.11 billion Indian rupees ($122.69 million) worth of equities on Friday, while domestic investors bought net 16.24 billion rupees worth of shares, as per provisional data available with the National Stock Exchange.
In Mumbai trading, Nifty's public sector bank (.NIFTYPSU) and private bank sector (.NIFPVTBNK) sub-indexes were among the top gainers, climbing 2.2% and 1.2%, respectively.
Bajaj Auto Ltd (BAJA.NS) was among the top performers on the Nifty 50 index, gaining 2% after it posted a bigger-than-expected rise in second-quarter profit on Friday. read more
Cement maker ACC Ltd (ACC.NS) was down as much as 1.7% ahead of its quarterly results later in the day.
In broader Asia, equities slipped on Monday following another drubbing for Wall Street, as investors braced for a further drastic tightening in global financial conditions.
