MUMBAI—Reliance Industries and several of India's largest private-sector banks were at the center of investor attention on Monday as markets reacted to a fresh round of quarterly earnings, with results from the country's biggest companies shaping sentiment for the broader equity market.
Shares of HDFC Bank led declines among financial stocks after investors focused on weaker-than-expected net interest margins despite steady profit growth, while ICICI Bank outperformed peers after reporting earnings that exceeded market expectations. Reliance Industries traded little changed after posting stronger-than-expected quarterly earnings supported by its oil-to-chemicals, telecom and retail businesses.
The benchmark Nifty 50 and BSE Sensex fell in early trading, with banking shares weighing on the indexes alongside concerns over higher crude oil prices linked to tensions in the Middle East. The Nifty Private Bank Index declined as investors reassessed earnings from HDFC Bank, Axis Bank and Kotak Mahindra Bank.
Reliance Industries reported quarterly results that surpassed analysts' estimates even though consolidated net profit was lower than a year earlier because of a one-off gain in the corresponding period. The company said stronger performance in its oil-to-chemicals business, telecom unit Jio Platforms and retail operations helped offset broader market challenges.
HDFC Bank reported continued loan growth, but analysts highlighted pressure on net interest margins amid intense competition and higher funding costs. Several brokerages revised their outlook following the results, while ICICI Bank received positive assessments after stronger-than-expected earnings.
The earnings season is being closely watched by investors for indications of corporate profitability, credit demand and consumer spending as companies navigate higher energy costs and global geopolitical uncertainty. Market participants are also monitoring additional quarterly reports from technology companies and other major listed firms scheduled later this week.
Analysts said corporate earnings, movements in crude oil prices, foreign investment flows and geopolitical developments are expected to remain the principal drivers of Indian markets in the coming days. Investors are awaiting further management commentary from reporting companies for updated guidance on business conditions and capital spending plans.
