The majority of the stability in the Indian stock indices on Monday morning was due to low bets at higher levels, with a slight downward bias. Some investors might still be taking profits from recent investments. When this report was being written, the Sensex and Nifty were down just 36 points and 4 points, respectively. The indices experienced losses on Thursday and Friday as a result of investors taking profits after the most recent bull run, which saw the indices reach all-time highs early last week.
Several analysts have been pointing out that any further rally from the current peak seems unlikely as valuations were higher, and that is what seems to have been happening in the past two-odd sessions.
In the past month, the indices — Sensex and Nifty — have cumulatively gained about 6 percentage points.
The most recent bull run in Indian stocks was fueled by a steady inflow of foreign portfolio funds, a solid economic outlook, a stable global economy, and a relatively moderate inflation rate. According to information provided by the National Securities Depository (NSDL), foreign portfolio investors (FPIs) have continued to be net buyers on the Indian stock markets for the fifth consecutive month.
On July 25–26, the US Federal Reserve will meet to discuss monetary policy. In its most recent meeting, the monetary policy committee of the US Federal Reserve paused the benchmark interest rate. The policy rate, which was close to zero following the COVID-19 outbreak, has been kept at 5.0–5.25%. With the exception of the most recent pause, the US central bank has increased interest rates for ten consecutive months, which was necessary to combat skyrocketing inflation.