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Markets magnify opening gains in early deals
Jun-05-2025

Indian equity benchmarks made slightly positive start on Thursday following the mixed cues from Wall Street overnight. Soon, markets gained traction and are trading firm with gains of over half a percent each in early deals tracking broadly positive cues from Asian counterparts amid optimism about the outlook for interest rates after the release of some weaker than expected U.S. economic data, which raised concerns about the strength of the economy. Foreign fund inflows also aided domestic sentiments. Besides, traders are eyeing the Reserve Bank of India's (RBI) monetary policy decision on June 6, with the central bank widely expected to cut interest rates by 25 basis points for the third consecutive time. In stock specific development, Hindustan Aeronautics gained amid reports that it is in discussions with General Electric (GE) for the engines for its Light Combat Aircraft (LCA) Mark 2.

The BSE Sensex is currently trading at 81432.50, up by 434.25 points or 0.54% after trading in a range of 80983.73 and 81461.99. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.30%, while Small cap index was up by 0.59%.

The top gaining sectoral indices on the BSE were Healthcare up by 0.78%, Consumer discretionary up by 0.78%, Power up by 0.73%, Utilities up by 0.61% and Energy up by 0.57%, while there was no loser on the BSE sectoral front.

The top gainers on the Sensex were Eternal up by 3.79%, Trent up by 2.35%, Adani Ports & SEZ up by 1.38%, Power Grid up by 1.37% and Reliance Industries up by 1.25%. On the flip side, Bajaj Finance down by 0.67%, Bajaj Finserv down by 0.35%, Axis Bank down by 0.29%, Bharti Airtel down by 0.29% and Tech Mahindra down by 0.15% were the top losers.

Meanwhile, Moody's Investors Service and its local arm ICRA Ratings have said that Indian enterprises are well positioned to handle the impact of tariffs and geopolitical tensions. However, they said India Inc will be ‘measured’ in making investment decisions in the new fiscal because of the external headwinds. Moody's said ‘Indian non-financial companies are not directly affected by US import tariffs due to their focus on domestic consumption and low dependence on exports’. It further noted that government initiatives to boost private consumption, expand manufacturing capacity and increase infrastructure spending will help offset the weakening outlook for global demand. 

Moody's Ratings managing director Vikash Halan said India's manufacturing growth will be constrained by challenges such as inadequacy of skilled labour, evolving logistics infrastructure and complex land and labour laws. It said select auto parts categories, cut and polished diamonds, and seafood exports have notable exposure to the US market and may face headwinds from demand moderation or rising competition, and added that the textiles sector is expected to benefit from its comparative advantage over China. It noted geopolitical tensions, particularly the India-Pakistan conflict, may weigh on near-term demand for travel and hospitality services. Nonetheless, India's overall exposure to these risks remains moderate.

ICRA's chief rating officer K Ravichandran said after being muted in FY25, urban consumption is expected to recover in FY26 supported by income tax relief, further rate cuts, and easing food inflation, and the same will benefit automobiles, consumer goods, and services sectors. Meanwhile, on the infrastructure creation front, ICRA forecasted a slowdown in road construction activity in the near-term, whereas other segments like ports and data centres will continue to witness significant investments, benefiting from solid government support, healthy capital outlays and a large pipeline of projects. 

The rating agencies said the country needs massive investments to meet its 2070 net-zero pledge, explaining that the country is grappling with the trilemma of energy security, affordability and transition. It said over the next decade, these investments are projected to constitute 2 per cent of real GDP for the electricity value chain, encompassing power generation, storage, transmission and distribution.

The CNX Nifty is currently trading at 24753.60, up by 133.40 points or 0.54% after trading in a range of 24613.10 and 24761.15. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Eternal up by 3.39%, Dr. Reddy's Lab up by 3.02%, Trent up by 2.39%, Grasim Industries up by 1.61% and Cipla up by 1.56%. On the flip side, Bajaj Finance down by 0.65%, Bajaj Finserv down by 0.45%, Axis Bank down by 0.41%, Bharti Airtel down by 0.21% and Indusind Bank down by 0.20% were the top losers.

Asian markets are trading mostly in green; Hang Seng rose 98.34 points or 0.42% to 23,752.37, Jakarta Composite gained 57.36 points or 0.81% to 7,126.40, Taiwan Weighted added 47.04 points or 0.22% to 21,665.13, KOSPI increased 36.02 points or 1.3% to 2,806.86, Shanghai Composite advanced 2.62 points or 0.08% to 3,378.82 and Straits Times was up by 0.96 points or 0.02% to 3,904.84, while Nikkei 225 slipped 167.91 points or 0.44% to 37,579.54.
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