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Rally in Indian equities shows continued strength
Jul-03-2026

Rally in Indian equities showed continued strength, with both Sensex and Nifty gaining over 0.70% each in early afternoon deals, aided by firm cues from other Asian markets along with heavy buying at IT and TECK counters, as weak U.S. jobs data raised expectations that the Federal Reserve will hold rates this month and potentially in September. Traders took a note of CareEdge's daily bulletin stating that India is unlikely to raise its official inflation target, with Reserve Bank of India Governor Sanjay Malhotra indicating there 'could be a case for lowering it over the long term as inflation remains well anchored.'

On the global front, all Asian markets were trading higher, after China's service sector continued to expand in June as new work posted strong growth, while cost pressures eased since May. The survey data from S&P Global showed that the headline RatingDog services Purchasing Managers' Index fell to 54.1 in June from 54.4 in the previous month. The reading was expected to decline to 53.0.

The BSE Sensex is currently trading at 78055.84, up by 553.72 points or 0.71% after trading in a range of 77854.83 and 78157.52. There were 20 stocks advancing against 9 stocks declining, while 1 stock remained unchanged on the index.

The top gaining sectoral indices on the BSE were IT up by 2.38%, TECK up by 2.06%, Realty up by 1.86%, Healthcare up by 1.40% and Metal up by 1.09%, while Capital Goods down by 2.07%, Power down by 2.01%, Industrials down by 1.19%, Auto down by 0.11% and PSU down by 0.10% were the top losing indices on BSE.

The top gainers on the Sensex were HCL Technologies up by 7.02%, Eternal up by 2.34%, Bajaj Finserv up by 2.33%, Tata Steel up by 2.03% and TCS up by 1.98%. On the flip side, State Bank of India down by 0.79%, Interglobe Aviation down by 0.73%, Kotak Mahindra Bank down by 0.56%, Axis Bank down by 0.52% and Mahindra & Mahindra down by 0.42% were the top losers.

Meanwhile, the Indian government has accelerated its disinvestment and asset monetisation plan in the current fiscal, raising about 31% of its full-year budgeted target in the first quarter itself. This is the fastest pace of disinvestment ever in the first quarter. In the period between mid-May and June of 2026, the government conducted one offer for sale every week for disinvestment of public sector enterprises. The divestments are part of government’s all-round efforts to garner revenues, especially from the non-tax side, amid stress of increased expenditure on subsidy due to a higher import bill. It has set full year target of Rs 80,000 crore envisaged in the FY27 Budget, to be raised from disinvestment and asset monetisation. It has raised Rs 24,928 crore so far and already firmed up a pipeline of public sector companies to be divested in the current fiscal with hopes of exceeding the budgeted target.

Further, the West Asia crisis has pushed up the energy and fertiliser import prices, consequently the impact crisis is expected to widen the fiscal deficit more than budgeted estimates. The government’s move to boost miscellaneous capital receipts or disinvestment and asset monetisation in the current fiscal comes in the back drop of West Asia crisis. As per government accounts, the fiscal deficit, which is the gap between income and expenditure, stood at over Rs 1.62 lakh crore or 9.6% of FY27 Budget target in the first two months of the fiscal. The government has set a 4.3% fiscal deficit target for FY27.

Garnering budgeted revenues would be key to address the stress related to likely doubling of fertiliser subsidy bill to about Rs 3 lakh crore and crude oil imports amid the West Asia crisis, and the impact of the El Nino on the monsoon. Meanwhile, the government has discontinued fixing separate disinvestment targets since the Revised Estimate (RE) of FY2023-24. Although, it kept Rs 30,000 crore, Rs 33,000 crore, Rs 33,837 crore and Rs 80,000 crore under Miscellaneous Capital Receipts for RE 2023-24, RE 2024-25, RE 2025-26 and BE 2026-27 respectively. These includes estimated receipts on account of management of equity investments and public assets through various mechanisms.

The CNX Nifty is currently trading at 24351.95, up by 176.25 points or 0.73% after trading in a range of 24295.15 and 24378.15. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were HCL Technologies up by 7.03%, Max Healthcare Inst. up by 2.62%, Dr. Reddy's Labs. up by 2.59%, Bajaj Finserv up by 2.41% and Eternal up by 2.25%. On the flip side, State Bank of India down by 0.80%, Interglobe Aviation down by 0.64%, Mahindra & Mahindra down by 0.48%, Kotak Mahindra Bank down by 0.46% and Bajaj Auto down by 0.42% were the top losers.

All Asian markets were trading higher; Jakarta Composite gained 141.45 points or 2.4% to 5,886.01, KOSPI increased 440.25 points or 5.44% to 8,088.34, Taiwan Weighted added 36.46 points or 0.08% to 46,780.62, Hang Seng advanced 268.97 points or 1.17% to 23,324.00, Nikkei 225 surged 911.85 points or 1.31% to 69,645.00, Straits Times rose 16.94 points or 0.32% to 5,234.09 and Shanghai Composite strengthened 14.74 points or 0.36% to 4,043.64.
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