Fresh worries about inflation and the decision of OPEC and its allies to cut more production capped gains for benchmarks, which were just starting to shake off fears of a contagion in global banking.

The Nifty 50 index closed 0.22 per cent higher at 17,398.05 on Monday. The S&P BSE Sensex rose 0.19 per cent to 59,106.44. The domestic markets will remain closed on Tuesday for a local holiday.

Nine of the 13 major sectoral indexes advanced, with auto stocks rising 1.5 per cent on strong March sales. SML Isuzu jumped 20 per cent after passenger vehicle sales more than tripled in March.

Inflation concerns soured sentiment on a sharp rise in crude oil prices after Saudi Arabia and other oil-exporting countries announced a surprise production cut over the weekend.

The cuts imply tightening of oil markets in the second half of 2023 and is a "negative for India as a whole and oil marketing companies in particular," analysts at Kotak Institutional Equities said in a note.

Bharat Petroleum Corporation of India and Hindustan Petroleum Corporation of India fell over 4 per cent each. Most of the Adani Group stocks also declined.

SEBI is investigating a possible violation of "related party" transaction rules in the conglomerate's dealings with at least three offshore entities linked to the brother of group founder Gautam Adani, Reuters reported, citing two people.

On the other hand, shares of PNB Housing jumped over 5 per cent after global brokerage Morgan Stanley reiterated "overweight", citing lower funding costs.

Investors are also cautious ahead of the Reserve Bank of India's rate decision due on April 06, said two analysts.

The RBI is likely to raise its main interest rate by 25 basis points and then pause for the rest of the year, according to a Reuters poll of economists.

Related Topics