Stock Market: Indian shares are set to start the day higher following their strongest session in eight weeks. Investors are eyeing the upcoming U.S. Federal Reserve policy decision and commentary, along with the interim Federal budget later this week.

The GIFT Nifty was at 21,961 points as of 7:50 am, indicating that the NSE Nifty 50 will open above its previous close of 21,737.60. 

Both the Nifty 50 and the BSE Sensex saw their best performance since December 4, 2023, driven by gains in heavyweights Reliance Industries and ONGC amid rising oil prices.

On Wall Street, the S&P 500 reached a new record high, while Asian markets remained subdued. 

The interim budget on Thursday and the Fed policy decision on Wednesday are expected to be key drivers for domestic equities, according to analysts.

Investors are optimistic about the interim budget's impact despite premium valuations. They eagerly await the Fed's commentary for insights into future rate paths.

Foreign institutional investors (FIIs) broke a seven-session selling streak on Monday, buying shares worth about Rs 110 crore, while domestic institutional investors (DIIs) remained net buyers, adding shares worth Rs 3,221 crore.

Key results expected on Tuesday include Bajaj Finserv, Dr. Reddy's Laboratories, and Larsen and Toubro.

Stocks to watch 

Bajaj Finance: Company missed December quarter profit view on lending tool ban, higher provisions.

Zee Entertainment Enterprises: Sony scrapped the $10 billion merger of its arm with the company as Zee failed to meet financial terms, according to a termination notice reviewed by Reuters.

KEC International: Company won new orders worth Rs 1,304 crore across its various businesses.

(With Reuters Inputs)