The Sensex and the Nifty came off day's high and were trading with modest gains in morning trade. At 10:35 IST, the barometer index, the S&P BSE Sensex, was up 255.98 points or 0.65% at 39,871.88. The Nifty 50 index was up 72.75 points or 0.61% at 11,943.40. Firmness in IT and FMCG shares supported key indices.
Indices opened higher and hit fresh intraday high in early trade. Benchmarks trimmed gains in morning trade as profit booking emerged at higher level.
Broader market reversed early gains. Among secondary barometers, the BSE Mid-Cap index was up 0.25%. The BSE Small-Cap index was down 0.02%.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1017 shares rose and 935 shares fell. A total of 117 shares were unchanged.
IT shares were in demand. Hexaware Technologies (up 2.27%), Tech Mahindra (up 2.23%), TCS (up 1.98%), Infosys (up 1.71%), HCL Technologies (up 1.56%), Oracle Financial Services Software (up 0.97%), Wipro (up 0.83%), MindTree (up 0.73%), Persistent Systems (up 0.66%) and MphasiS (up 0.03%), edged higher.
The S&P BSE IT index was up 1.50% at 15,975.26, outperforming the Sensex.
FMCG shares advanced as onset of monsoon could boost rural demand for groceries and daily essentials. Normal monsoon season could lift buying power in the villages. Britannia Industries (up 2.63%), Hindustan Unilever (up 1.71%), Dabur India (up 1.40%), GlaxoSmithKline Consumer Healthcare (up 1.19%), Nestle India (up 1.02%), Marico (up 0.70%), Godrej Consumer Products (up 0.54%), Tata Global Beverages (up 0.39%), Bajaj Corp (up 0.18%), Colgate Palmolive (India) (up 0.14%) and Procter & Gamble Hygiene & Health Care (up 0.06%), edged higher. Jyothy Laboratories was down 1.42%.
The S&P BSE FMCG index was up 1.05% at 11,652.95, outperforming the Sensex.
The 2019 monsoon set in over parts of Kerala on Saturday, 8 June 2019, against its normal date of 1 June. A low pressure area formed over Southeast and adjoining Lakshadweep & East central Arabian Sea. It is very likely to intensify into a depression over Southeast & adjoining East central Arabian Sea during next 48 hours. It is likely to move north-northwestwards and intensify further into a cyclonic storm during subsequent 24 hours, IMD said in a release.
Overseas, Asian shares were trading higher on Monday, after the US and Mexico reached a deal to avoid the implementation of tariffs.
China's May exports rose 1.1% from a year earlier, leaving it with an overall trade surplus of $41.65 billion for the month.
US stocks ended higher on Friday, as weak jobs data raised hopes for interest rate cuts. The US economy added 75,000 jobs in May, marking the second time in four months that jobs growth totaled less than 100,000.
President Donald Trump said on Friday that the United States and Mexico have signed an agreement to avoid tariffs that were scheduled to go into effect on Monday. Trump said that Mexico in return has agreed to take strong measures to stop illegal immigration coming through the US southern border.
Last week, Trump threatened to impose 5% tariffs on all Mexican imports starting 10 June if Mexico did not do more to stop illegal immigration.