On Monday, the Indian stock market saw thin gains in a choppy session. Despite a spike in crude oil prices, buying in auto, banking, and capital goods shares helped the benchmark indices Sensex and Nifty settle with gains for the third straight session. The BSE Sensex rose by 0.19% to close at 59,106.44 points, while the broader NSE Nifty advanced by 0.22% to close at 17,398.05 points. The gains were supported by auto, capital goods, and banking and financials shares, while selling in IT, FMCG, and metal shares restricted the gains in key indices.
Vinod Nair, Head of Research at Geojit Financial Services, commented that investors believed easing price pressure would provide the central bank with leeway to pause the rate hike. However, the surprise production cut by OPEC+ has fuelled concerns about inflationary pressure, which may prompt central banks to remain hawkish.
Oil prices jumped around 5% to nearly one month high of USD 84.19 per barrel on Monday after Saudi Arabia and other major oil producers announced a production cut of 1.15 million barrels per day from May until the end of the year. On the other hand, manufacturing activities in India touched a three-month high in March boosted by faster expansion in new orders and output amid demand resilience and easing of cost pressures, according to a monthly survey.
Global markets were mixed as a spike in crude oil prices fuelled fears of high energy prices in Europe and the US. Tokyo’s Nikkei 225 index gained 0.5%, Hong Kong’s Hang Seng slipped 0.4%, while the Shanghai Composite index rose 0.7%.
Meanwhile, RBI’s rate-setting panel on Monday started its three-day meeting amid expectations that the central bank may go for a 25 basis points hike in the benchmark interest rate, probably the last in the current monetary tightening cycle that began in May 2022. On Friday, Foreign Institutional Investors (FIIs) were net buyers as they purchased shares worth Rs 357.86 crore.