Benchmark indices opened higher on Tuesday, extending the previous session’s rebound as gains in banking and financial stocks lifted market sentiment ahead of the Reserve Bank of India’s monetary policy decision. At 9:40 am, the Sensex was at 72,596.30, up 213.83 points or 0.30%, while the Nifty 50 stood at 22,596.75, gaining 43 points or 0.19%. Both indices opened higher and touched early session highs.

The gains followed a positive session on Monday, when the Sensex and Nifty rose 0.66% and 0.60%, respectively. The recovery came after both benchmarks had recorded their eighth consecutive weekly decline. Lower crude oil prices and softer-than-expected US jobs data had supported the previous session by reducing expectations of aggressive monetary tightening by the US Federal Reserve.

Banking and financial stocks were among the key drivers of Tuesday’s gains. The Nifty Financial Services 25/50 index rose 0.59%, while the private bank index gained 1.12% and the PSU Bank index advanced 0.22%. Kotak Mahindra Bank was among the strongest performers in the Sensex pack, rising 3.86%, while Axis Bank gained 1.40% and HDFC Bank advanced 0.21%. Bajaj Finserv and Bajaj Finance also traded higher after lenders reported positive quarterly business updates.

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Other major gainers included Trent, which jumped 9.01%, while Reliance Industries rose 0.91% and IndiGo gained 0.63%. In the broader market, the Nifty 100, Nifty 200 and Nifty 500 advanced between 0.34% and 0.40%. Mid-cap and small-cap indices also opened higher. Sectorally, metals, oil and gas and consumer durables gained, while IT stocks remained under pressure, with the Nifty IT index down 0.62%.

Investors are closely watching the RBI Monetary Policy Committee’s decision due on Wednesday. Geojit Investments Chief Investment Strategist Dr V K Vijayakumar said a 25-basis-point rate hike appeared likely and was largely factored into market valuations. He said investors would focus more on the central bank’s policy stance and its projections for growth and inflation than the rate decision itself. He also said a sustained market rally would require a sharper decline in crude oil prices.

Crude oil remained elevated, with Brent crude at $100.63 a barrel and WTI crude at $89.69 in early trade. High US bond yields and continued foreign investor selling also remained an overhang, with the US 10-year yield around 5.3%. Vijayakumar said this could keep the market in a “sell on rally” phase despite support from domestic institutional investors. Investors will now track the RBI’s policy stance, inflation and growth outlook, crude prices, global bond yields and foreign fund flows for further market direction.

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