Stock markets snapped the four-day falling streak on Tuesday with the benchmark Sensex rebounding by 317 points on buying in auto and pharma shares amid a decline in retail inflation to a more than six-year low, nearing the RBI’s comfort zone.
Photograph: Shailesh Andrade/Reuters
The 30-share BSE Sensex climbed 317.45 points or 0.39 per cent to settle at 82,570.91.
During the day, it jumped 490.16 points or 0.59 per cent to 82,743.62.
The 50-share NSE Nifty edged higher by 113.50 points or 0.45 per cent to 25,195.80.
In the last four trading days, the Sensex dropped 1,459.05 points or 1.74 per cent and the Nifty declined by 440 points or 1.72 per cent.
Among Sensex firms, Sun Pharma, Trent, Tata Motors, Bajaj Finserv, Mahindra & Mahindra and Bajaj Finance were the major gainers.
However, HCL Tech declined 3.31 per cent after the IT services firm reported a 9.7 per cent drop in consolidated net profit for the June quarter, hurt by higher expenses and the one-time impact of a client bankruptcy.
Eternal, Tata Steel, Kotak Mahindra Bank and Axis Bank were also the laggards.
Retail inflation declined to over six-year low of 2.1 per cent in June, nearing the RBI’s comfort zone, on account of subdued prices of food items, including vegetables, driven by widespread monsoon.
The Consumer Price Index-based inflation was 2.82 per cent in May and 5.08 per cent in June 2024. Inflation is on a decline since November 2024.
“Market sentiment is showing signs of improvement, supported by a blend of global and domestic developments.
“Optimism is growing around the possibility of an interim trade agreement with the US, which could lead to a moderation in tariff-related risks.
“Concurrently, domestic inflation has fallen to multi-year lows, strengthening expectations of a further rate cut by the RBI用otentially accelerating future economic growth, which is currently showing signs of improvement,” Vinod Nair, Head of Research, Geojit Investments Limited, said.
The BSE smallcap gauge climbed 0.95 per cent and midcap index went up by 0.83 per cent.
Among BSE sectoral indices, auto (1.48 per cent), healthcare (1.14 per cent), consumer discretionary (0.89 per cent), FMCG (0.80 per cent), realty (0.77 per cent) and services (0.58 per cent) were the gainers.
Utilities emerged as the only laggard.
As many as 2,576 stocks advanced while 1,479 declined and 160 remained unchanged on the BSE.
“Markets witnessed some respite and edged marginally higher after four consecutive sessions of decline.
“Participants drew comfort from the further easing of CPI inflation, which triggered notable buying in rate-sensitive sectors on hopes of a potential rate cut.
“However, continued disappointment from the IT space, following HCL Technologies’ results, capped overall momentum,” Ajit Mishra – SVP, Research, Religare Broking Ltd, said.
In Asian markets, South Korea’s Kospi, Japan’s Nikkei 225 index and Hong Kong’s Hang Seng settled in the positive territory while Shanghai’s SSE Composite index ended lower.
Global oil benchmark Brent crude dipped 0.17 per cent to $69.09 a barrel.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,614.32 crore on Monday, while Domestic Institutional Investors (DIIs) bought stocks worth Rs 1,787.68 crore, according to exchange data.
