India's benchmark BSE index closed at its lowest level in over 1-1/2-year low on Monday on the back of continued worries about Chinese equities. The BSE index ended 0.44 percent lower to mark its lowest close since June 4, 2014. The broader NSE index ended 0.49 percent lower. India's NSE index has fallen 4.5 percent so far this year, as turbulent markets in China have raised doubts about Beijing's ability to manage the world's second-biggest economy.
But analysts feel India's relatively stronger economic fundamentals will allow domestic markets to withstand shocks from China. Instead investors are soon expected to shift focus to earnings, with Tata Consultancy Services due to kick off earnings on Tuesday. "We're seeing some short-covering, but worries about China still exist. I'm not very optimistic about Q3 earnings, we could fall further," said Alex Mathews, head of research at Geojit BNP Paribas
Oil stocks such as Cairn India, BPCL and ONGC fell between 1 percent and 3 percent each after global crude prices slipped 3 percent. Sintex Industries fell as much as 7 percent after the company lowered its revenue guidance. Shares in NSE heavyweight Reliance Industries were up 3 percent, building on the 1.23 percent gains from Friday. Tata Motors gained 2.5 percent despite concerns of a slowdown in China affecting sales.