Snapping 6-day losses, equity indices rise in opening deals

by IANS |

New Delhi, May 16 (IANS) Snapping their six straight session losses, Indian equity indices rose in opening deals on Monday, possibly due to value buying at lower levels.

At 9.51 a.m., Sensex was 1.0 per cent or 513 points up at 53,307 points, whereas Nifty was 1.2 per cent or 185 points up at 15,967 points.

The recent consistent decline was triggered as equity investors were concerned about the persistent high inflation globally and tightening monetary policy stance by several central banks.

India's retail inflation accelerated to 7.79 per cent in April due to high fuel and food costs. The inflation print remained above the tolerance limit of the central bank RBI for a fourth month in a row.

Analysts expect inflation to be on the higher side in coming months too.

In a bear phase there will be relief rallies, but such rallies are unlikely to sustain, given the relentless selling by FIIs, said V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"It is rational to expect more FII selling, particularly when the market stages relief rallies. It is important to appreciate the fact that FIIs are selling not because they are bearish on India but because the US bond yields are attractive and the dollar is strengthening," said Vijayakumar.

Long-term investors can start accumulating high quality stocks in financials, telecom, IT and construction segments.

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