Earnings power Indian stocks to fourth day of gains ahead of holidays

Indian equities rose for a fourth consecutive session on Monday, ahead of a two-day holiday, due to better-than-expected earnings from banks and index heavyweight Reliance.

The Nifty 50 and the BSE Sensex increased about 0.5% each to one-year-highs of 25,843.15 and 84,363.37, respectively. Their 2.8% gain over four sessions has left them less than 2% shy of their lifetime highs hit in September 2024.

The flurry of earnings over the weekend ensured trading volumes were normal ahead of the market holiday on Tuesday and Wednesday for a local festival, an analyst and a trader said.

Twelve of the 16 major sectors logged gains. The broader small-caps and mid-caps rose about 0.5% and 0.8%, respectively.

The “domestic markets will reverse their underperformance over global peers as optimism is gradually returning, and the stage is set for recovery as valuations are reasonable and earnings downgrades have bottomed out,” said Amisha Vora, chairperson and managing director at PL Capital.

Reliance Industries jumped 3.5% to a three-month high after its September-quarter earnings, with analysts bullish on the oil-to-telecom conglomerate’s core earnings, retail segment, and improving earnings outlook.

Public sector banks jumped 2.9%, their biggest single-day gains in about four months, after strong earnings from several lenders over the weekend.

Punjab National Bank gained 3.9% after its results, while State Bank of India, India’s largest lender, rode the optimism to a 2.1% gain.

Top private sector lender HDFC Bank closed flat. It, however, hit a lifetime high earlier after reporting stable quarterly earnings growth and an improvement in asset quality.

ICICI Bank though, fell 3.2% despite beating quarterly profit estimates on concerns about soft loan and deposits growth.

RBL Bank jumped 9.1% after Emirates NBD bank invested $3 billion in the private lender.

The Indian markets will have a special trading session from 2:30 p.m. to 3:30 p.m. IST on Tuesday.