Indian stock markets opened in the green on Monday, driven by upbeat global sentiment and hopes of foreign institutional investors (FIIs) returning to Indian equities.
As of 9:25 AM, the BSE Sensex was up 115 points (0.14%) at 83,331, while the NSE Nifty gained 35 points (0.14%) to trade at 25,521.
Broader markets outperformed the benchmarks, with the Nifty Midcap 100 up 0.37% and the Nifty Smallcap 100 rising 0.27%, indicating strong investor appetite beyond large-cap stocks.
Among the key gainers in the Nifty pack were Asian Paints, L&T, and Hindalco, while Trent, Apollo Hospitals, Max Healthcare, Maruti Suzuki, and Dr Reddy’s Laboratories were among the notable laggards.
Sectorally, Nifty IT, Metal, and Pharma indices led the gains, advancing between 0.56% and 0.79%, while all other sectoral indices traded in positive territory except Nifty Media, which remained subdued.
FII Flows and AI Stock Impact
Market analysts attributed the upbeat sentiment to expectations that FIIs — particularly hedge funds — may pause their recent selling spree and redirect funds towards emerging markets like India.
This shift follows recent losses in global artificial intelligence (AI) stocks, which had previously drawn heavy foreign investment.
“The strong earnings growth in the US had fuelled an AI-driven rally, pushing valuations to excessive levels. However, with recent corrections and signs of cooling, investors are likely to reallocate to non-AI markets such as India,” analysts noted.
They further added that the 3% decline in the Nasdaq last week indicates the AI trade may be losing momentum.
“If this trend continues without major volatility, it could stabilise US markets and prevent a bubble burst scenario,” they said.
Global Market Influence
Positive global cues also lent support to Indian equities.
Wall Street closed mostly higher in the previous session, with the Dow Jones up 0.16%, the S&P 500 gaining 0.13%, and the Nasdaq marginally down 0.22%, amid reports suggesting progress toward ending the longest US federal government shutdown.
In Asia, most markets were trading higher during morning hours. Japan’s Nikkei rose 1.04%, Hong Kong’s Hang Seng gained 0.57%, and South Korea’s Kospi surged 3.04%.
However, China’s Shanghai Composite and Shenzhen Index edged down 0.03% and 0.59%, respectively.
On Friday, FIIs were net sellers, offloading equities worth ₹4,889 crore, while domestic institutional investors (DIIs) purchased shares worth ₹1,787 crore, partially offsetting the foreign outflows.
With global risk appetite improving and AI-driven valuations cooling off, Indian markets are expected to remain resilient.
Analysts anticipate continued inflows into midcap and infrastructure-related stocks, backed by India’s robust economic outlook and strong corporate earnings.
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