Mumbai: Indian stock markets opened slightly higher on Monday after strong quarterly results from major private lenders lifted early sentiment, but gains remained limited as investors stayed cautious due to global tensions and rising oil prices.
The benchmark indices, the Nifty 50 and the BSE Sensex, saw marginal gains in early trade. However, the market soon turned mixed as pressure from global factors offset the positive momentum created by banking stocks.
Shares of ICICI Bank rose around two percent after the bank reported better than expected quarterly earnings. The bank posted a strong rise in profit, supported by steady loan growth and lower provisions for bad loans. Investors reacted positively to the results, making it one of the top performers in early trade.
In contrast, HDFC Bank reported a rise in profit but its shares slipped slightly. Market participants were concerned about pressure on margins and slower income growth, which reduced enthusiasm despite the overall improvement in earnings.
Analysts said the banking sector continues to show resilience, with private lenders expected to record steady profit growth driven by strong credit demand and better asset quality. However, margin pressures remain a key concern for investors.
The broader market did not fully reflect the gains seen in banking stocks. Most sectors traded lower, and mid cap and small cap stocks also declined, showing that the positive sentiment was limited to a few large companies.
Global developments also weighed on investor mood. Rising tensions in the Middle East and concerns over supply disruptions pushed oil prices higher, adding pressure on import dependent economies like India. Higher oil prices are seen as a risk to inflation and economic stability.
Despite the cautious outlook, foreign investors continued to buy Indian equities for the third straight session, offering some support to the market.
Market experts said that while strong corporate earnings are helping to support stock prices, global uncertainties and rising costs are likely to keep gains limited in the near term.