 "Bulls may stay in control on Dalal Street after Greece verdict")
Analysts said mood towards emerging markets remained upbeat following the quantitative easing announced by the European Central Bank (ECB).
The agreement reached on operationalising the India-US civil nuclear deal might see the Indian market continuing to race ahead of peers. Stocks of the capital goods, infrastructure and defence sectors are expected to see huge gains going forward. Analysts say this would add to the optimism already present in the market. Indian markets have been hitting record highs for the past eight sessions. On Friday, the BSE Sensex closed up 0.9 per cent or 272 points to 29,278. The NSE Nifty also ended up about 1 per cent at 8,835.
Optimism in the Indian markets has largely been driven by the surprise 25-basis point cut in the repo rate by the Reserve Bank of India (RBI) earlier this month. Market participants believe that the Indo-US nuclear deal will add impetus to the optimism.
Most global markets on Monday after initial weakness ended higher but investors hoped Europe would reach an agreement with the new government in Greece.
Analysts, however, cautioned that markets could remain volatile as long as the fears surrounding a possible Greece exit persisted.
European markets also gained on Monday on the back of optimism brought on by the ECB stimulus package announced last week, market analysts said.
In the absence of a clear majority, Syriza joined hands with the Greek Independents to form an anti-bailout coalition government.
Though Syriza appears less inclined to exit the euro zone than speculated earlier, it is keen on reworking the terms of a €240-billion ($269-billion) bailout extended to the country. Political analysts say as a majority of Greeks want to stay in the euro zone, Syriza seems to have toned down its aggressive stance.
"But to stay it will have to reach agreement with the troika (the EU, ECB and IMF) on its budget and reform programme and to do that it will have to compromise," said Shane Oliver, head of investment strategy and chief economist at AMP Capital.
With Greece likely to stay within the euro zone, the good news would be the likely liquidity rush from Europe into the Indian stock market. The EU's over €1-trillion bond-purchasing programme promises plenty of capital flows on the back of continued stability in the euro zone.
"The impact of the Greek elections (on the Indian market) is likely to be minimal. But the flow of liquidity would continue into Indian markets because of the ECB's quantitative easing programme and the rate cut by the RBI earlier this month," said Deven Choksey, managing director of KR Choksey Securities.
Corporate earning announcements for the December 2014 quarter are already underway. While the earning expectations remain muted, many believe this could be the last of the weak quarters seen over the past few years.
European markets end flat after hitting 7-year highs; euro steady
The euro steadied after losing ground on Monday, suggesting confidence in the ECB's new money-printing programme despite Greek election winner Syriza's pledge to take on international lenders. Earlier in the day, European shares traded at a seven-year high as optimism over central-bank stimulus prevailed.
Prime Minister-elect Alexis Tsipras forged an anti-austerity coalition with the Independent Greeks hours after defeating
Prime Minister Antonis Samaras's New Democracy in the Sunday election, putting the future of the nation's austerity programmes in doubt.
Even so, the Stoxx
Europe 600 Index rose for an eighth day.
Global stock indexes were little changed. US stocks were lower in early trading, while MSCI's global share index was up slightly.
The main Athens index fell and Greek bond yields rose.