Opening Bell: Nifty above 17,200, Sensex gains over 200 points; Auto stocks shine ahead of release of July sales numbers

Extending gains to the fourth session, the Indian market opened marginally higher amid improved global sentiment on Monday. Benchmarks opened higher by nearly 0.4 % each ahead of the release of auto sales numbers. The Broader Nifty 50 opened above 17,200, while the 30-share Sensex started above 57, 800. The barometer indices opened at 17,243.20 and 57,823.10 respectively on Monday.

In the week ended July 29, the market ended more than two and half per cent, while the benchmarks rose almost 9% in July.

""The 9% rally in Nifty in July is in sync with the 9% rally in S&P 500. The pull back in US and other developed markets was facilitated by the strong employment numbers and resilience of the US economy, triggering hopes that the US might succeed in avoiding a recession, or if the recession happens, that would be a mild one," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

He said the big positive for the Indian market is the FPIs turning buyers in July after 9 months of relentless selling. The sharp decline in the dollar index from above 109 to below 106 now indicates that the flight to the safety of the dollar is over for now, said Vijaykumar.

"At 17150 Nifty valuations are again moving to the higher side. So at higher levels investors have to exercise caution. After the expected run up in financials, now, capital goods, autos, particularly PV and CV segments and select pharmaceuticals look interesting. High quality financials will continue to be resilient," he added.

On Nifty outlook, Anand James, Chief Market Strategist at Geojit Financial Services, said we will keep the vigil for potential withdrawal in buyers, on approach to17320 and 17045 identified on either sides of present level. "Major supports are seen at 16960 and 16800/750 regions," he added. 

In the broader market, Nifty Midcap and Smallcap gained more than half per cent each.  

Among sectoral indices, Nifty IT, Realty and Consumer Durables witnessed some profit booking, while all other indices traded higher in early trade on Monday. Auto, metal were top performing indices in the opening trade.  

Earlier, SGX Nifty, which indicates opening trends of the Indian market, was seen trading marginally higher by 20 points on the Singaporean exchange in early trade on Monday.  

Meanwhile, Japanese Nikkei 225 gained 0.4%, Hang Seng Index at the Hong Kong exchange dropped 0.9% and Shanghai Composite was trading lower by 0.3% on Monday morning. 

In the US, the Dow Jones jumped 315 points to close near the day's high on Friday, while the Nasdaq gained 1.9% in the weekend closing.