HDFC Bank and Axis Bank shares gained on Monday after reporting strong credit growth for the June quarter. The positive business updates lifted investor sentiment, fueling gains in the Nifty Financial Services index as markets tracked the start of the Q1 earnings season.
Indian equity markets opened the week on a positive note, with benchmark indices Sensex and Nifty50 seeing gains supported by the banking sector. This movement followed the release of June quarter business updates from major private lenders, which indicated continued momentum in credit demand.
HDFC Bank shares climbed nearly 2% after the lender reported a 15.4% year-on-year increase in gross advances and a 14.7% rise in deposits for the quarter ending June 30, 2026. Similarly, Axis Bank announced an 18.8% growth in its gross advances. These figures suggest that retail and corporate credit demand remains firm, providing a lift to the Nifty Private Bank and Nifty Financial Services indices. In contrast, the Nifty PSU Bank index experienced minor weakness, highlighting a varied performance across the wider banking industry.
Beyond financials, the broader market showed resilience. The Nifty Auto, Nifty Pharma, and Nifty Realty indices trended upward, while the Nifty FMCG and Nifty Media sectors saw slight declines. Technology stocks remained relatively flat, reflecting a cautious wait-and-watch approach ahead of full quarterly earnings reports.
Investors are now turning their attention to the broader Q1 earnings season, which begins this week. While some market analysts expect overall corporate earnings to remain moderate due to lingering global pressure and past energy costs, the financial and automobile sectors are being closely watched for their ability to maintain margin stability and volume growth. Supporting the current sentiment is the easing of commodity cost pressure, with Brent crude prices trading near $72.21 per barrel, which helps reduce inflationary concerns for the domestic economy.
Looking ahead, the market will focus on how these credit growth numbers translate into actual net interest margins and profitability when the banks release their full financial results. Additionally, while the India VIX, a gauge of market volatility, showed a slight uptick, the overall trend remains sensitive to foreign institutional investor activity and updates on the monsoon’s progress, both of which are considered important factors for domestic economic health.