Key gauges advance for 4th day; Nifty ends above 23,550 mark

Indian equity benchmarks ended higher for the fourth day in a row on Tuesday, helped by hectic buying in market heavyweights Power Grid Corporation, Wipro and Titan Company amid a firm trend in global equities. After opening on a positive note, the markets shifted into a range bound movement with positive bias throughout the day, as traders took encouragement with President of the Confederation of Indian Industry (CII) stating that within a few years, India will undoubtedly be among the world’s top three economies. Some support also came as data from the Reserve Bank of India (RBI) showed India's foreign exchange reserves jumped $4.307 billion to touch a new lifetime high of $655.817 billion during the week that ended June 7. The reserves have been rising on and off for a long time now. So far in 2024, they have risen over $30 billion, on a cumulative basis. Besides, fresh foreign fund inflows boosted investor confidence. Foreign Institutional Investors (FIIs) bought equities worth Rs 2,175.86 crore on Friday, according to exchange data.

A firm trade continued over the Dalal Street in second half of trading session, as Fitch Ratings raised India's growth forecast for current fiscal to 7.2 per cent, from 7 per cent projected in March, citing a recovery in consumer spending and increased investment. For the fiscal years 2025-26 and 2026-27, Fitch projected growth rates of 6.5 per cent and 6.2 per cent, respectively. Sentiments remained optimistic as India and the US have agreed to closer engagement and cooperation on supply chain, semiconductors and critical minerals during the meeting of the India-US initiative on Critical and Emerging Technology (iCET), led by Indian National Security Adviser Ajit Doval and his US counterpart Jake Sullivan in New Delhi. However, gains remained capped as some concern came with domestic rating agency ICRA’s statement that India Inc are bracing for revenue uncertainties in the April-June period (Q1FY25) due to a slowdown in government spending during the Parliamentary elections and the onset of the annual monsoon season. 

On the global front, European markets were trading higher after Eurozone CPI was finalized at 2.6 percent year-on-year in May, up from April's 2.4 percent as widely expected. Asian markets finished mostly higher on Tuesday, on optimism over the outlook for interest rates as the markets benefitted from the positive sentiment generated by tamer-than-expected US inflation data last week. 

Finally, the BSE Sensex rose 308.37 points or 0.40% to 77,301.14, and the CNX Nifty was up by 92.30 points or 0.39% points to 23,557.90.   

The BSE Sensex touched high and low of 77,366.77 and 77,071.44 respectively. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.43%, while Small cap index was up by 0.96%.

The top gaining sectoral indices on the BSE were Realty up by 2.11%, Consumer Durables up by 1.27%, Utilities up by 1.05%, Telecom up by 1.00% and Consumer Discretionary up by 0.90%, while Healthcare down by 0.46%, Metal down by 0.21%, Oil & Gas down by 0.08%, FMCG down by 0.07% and Auto down by 0.03% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid Corporation up by 3.17%, Wipro up by 3.04%, Titan Company up by 1.74%, ICICI Bank up by 1.56% and Mahindra & Mahindra up by 1.14%. On the flip side, Maruti Suzuki down by 2.14%, Tata Steel down by 1.04%, Ultratech Cement down by 0.96%, Tata Motors down by 0.78% and ITC down by 0.53% were the top losers.

Meanwhile, Fitch Ratings has raised India's Gross Domestic Product (GDP) growth forecast for current fiscal (FY25) to 7.2 per cent, from 7 per cent projected in March, citing a recovery in consumer spending and increased investment. For the fiscal years 2025-26 and 2026-27, Fitch projected growth rates of 6.5 per cent and 6.2 per cent, respectively. Fitch's estimates are in line with that of the Reserve Bank of India (RBI), which also projected Indian economy to expand 7.2 per cent in FY25 on the back of improving rural demand and moderating inflation. 

Fitch said investment will continue to rise but more slowly than in recent quarters, while consumer spending will recover with elevated consumer confidence. It said purchasing managers’ survey data point to continued growth at the start of the current financial year. It said signs of the coming monsoon season being more normal should support growth and make inflation less volatile, though a recent heatwave poses a risk. 

It noted that the Indian economy grew 8.2 per cent in the last fiscal (2023-24), with a 7.8 per cent expansion in March quarter. Fitch expects inflation will decline to 4.5 per cent by end 2024 and average 4.3 per cent in 2025 and 2026. It also expects the RBI to cut policy interest rates by 25 basis points this year to 6.25 per cent.

The CNX Nifty traded in a range of 23,579.05 and 23,499.70. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Shriram Finance up by 3.22%, Power Grid Corporation up by 3.13%, Wipro up by 2.94%, ICICI Bank up by 1.82% and Titan Company up by 1.58%. On the flip side, Maruti Suzuki down by 2.14%, Dr. Reddy's Lab down by 1.60%, Ultratech Cement down by 1.09%, Tata Steel down by 1.04% and Hindalco Industries down by 0.82% were the top losers. 

European markets were trading higher; UK’s FTSE 100 increased 37.05 points or 0.46% to 8,179.20, France’s CAC rose 47.6 points or 0.63% to 7,619.17 and Germany’s DAX gained 85.06 points or 0.47% to 18,153.27.

Asian markets finished mostly higher on Tuesday, kindled by the rally in technological sector stocks amidst artificial intelligence frenzy. Moreover, renewed optimism over Fed interest rate trim after tamer than expected US May inflation figures and risk appetite ahead to the release of series of US economic data this week boosted equity investments. Bargain hunting after previous sessional losses, weakness in crude oil, and negative trend in gold also buoyed indices. Shanghai index advanced despite China-EU trade tensions and rebound in treasury bond yield notes. Stock market of Indonesia was closed for Eid-al-Adha.