The Benchmark indices — the 30-share Sensex and Nifty-50 —closed in the red for the third consecutive trading session on Monday. The Sensex slid 518.64 points, or 0.84%, to end at 61,144.84, while the broader Nifty fell 147.70 points, or 0.81%, to close at 18,159.95. This fall comes despite the fall in Brent Crude to near two-month lows to near $87/barrel.

IT and energy stocks dragged down the indices, with Tech Mahindra and TCS falling 2.11% and 1.81%, respectively. Adani Ports was the biggest loser on the Nifty, falling 2.13%. RIL, an index heavy weight, lost 1.91%.

Also read: Sensex, Nifty end in red for 3rd day in a row, dragged by hawkish Fed; momentum weak, watch this key support

FIIs sold shares worth Rs 1,593 crore while DII bought shares of Rs 1,262.91 crore on Monday.

Banking stocks turned out to be outliers, with some PSU banks rising over 1%. “All four Cs are aligning positively for the banks — rising credit growth, falling credit costs, well capitalised balance-sheet and valuation cheapness. With the economy gaining strength post COVID, the credit growth has picked up sharply to decade-high levels of 16-17%. NPAs have also come down sharply, as reflected by the falling credit costs in the recent quarterly earnings. The banks are very well capitalised, with decade-high Tier-1 ratio,” said Dhimant Kothari, fund manager at Invesco Mutual Fund.

Also read: Bank Nifty poised to scale new highs, minor correction likely; ICICI Bank, Kotak Bank, SBI among top picks

According to Kothari, persistent earnings upgrades in last few quarters and Bank Nifty’s underperformance vis-a-vis the Nifty since April 2020 make the valuations attractive despite the recent run-up.

Speaking to a TV channel on Monday, Andrew Holland, CEO of Avendus Alternate Strategies, said India “remains an underweight”, and with the US Fed likely to take a pause in rate hikes early next year, emerging markets will be the place to find growth, adding that he continues to bet on financials.