Benchmarks end higher amid inflation relief, monsoon boost

Equity benchmarks posted moderate gains on Wednesday, buoyed by softer-than-expected WPI and retail inflation data in India. Adding to the cheer, the timely arrival of the southwest monsoon over the Andaman Sea lifted domestic sentiment. Global markets mirrored the optimism, as U.S. consumer inflation for April came in below expectations, sparking hopes of a more dovish Fed stance.

Despite a strong opening powered by upbeat global cues, the domestic benchmarks struggled to sustain their early momentum. The Nifty briefly surged past the 24,750 mark in the first half but faced selling pressure midway, slipping below 24,550 before staging a modest recovery.

It was a volatile ride through the session. IT and metal stocks were the early stars, driving gains, while a slide in private banking names briefly dragged the index into negative territory. Energy stocks later stepped up, lending crucial support and helping the Nifty close above 24,660.

The S&P BSE Sensex advanced 182.34 points or 0.22% to 81,330.56. The Nifty 50 index added 88.55 points or 0.36% to 24,666.90.

Bharat Electronics (up 2.56%), Infosys (up 1.50%) and Reliance Industries (up 0.57%) supported the indices.

Broader markets displayed stronger resilience, with the BSE Midcap and Smallcap indices rising by 1.19% and 1.63% respectively, comfortably outperforming the headline index.

The market breadth was strong. On the BSE, 2,855 shares rose and 1,121 shares fell. A total of 149 shares were unchanged.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, tanked 5.35% to 17.23.

Monsoon Onset:

The southwest monsoon is progressing as anticipated, having reached the Andaman Sea and parts of the southern Bay of Bengal. This marks the initial entry point for the southwest monsoon, according to the India Meteorological Department (IMD), Thiruvananthapuram. The IMD had forecast the onset of the monsoon for May 13, and it arrived on schedule. Over the next four to five days, it is expected to advance northward, covering additional areas of the Arabian Sea and Bay of Bengal and extending into the Andaman Islands and most parts of the Andaman Sea.

Economy:

India's wholesale inflation (WPI) eased further to 0.85% in April on an annual basis as against a four-month low of 2.05% in March, the government data showed on Wednesday. Positive rate of inflation in April, 2025 is primarily due to increase in prices of manufacture of food products, other manufacturing, chemicals and chemical products, manufacture of other transport equipment, manufacture of machinery and equipment, etc.

India's retail inflation in April fell to 3.16% from 3.34% in March, according to official data released by the Ministry of Statistics and Programme Implementation on Tuesday. Effectively, headline inflation declined 18 basis points in April 2025 compared to March 2025. According to the government, it is the lowest year-on-year inflation since July 2019. The significant decline in headline inflation and food inflation during the month of April 2025 is mainly attributed to the decline in inflation of vegetables, pulses & products, fruits, meat and fish, personal care and effects, and cereals and products.

Numbers to Track:

The yield on India's 10-year benchmark federal paper fell 0.52% to 6.348, compared with the previous close of 6.381.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 85.2850, compared with its close of 85.3600 during the previous trading session.

MCX Gold futures for the 5 June 2025 settlement shed 0.22% to Rs 93,445.

The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.49% to 100.33.

The United States 10-year bond yield fell 0.98% to 4.455.

In the commodities market, Brent crude for June 2025 settlement lost 82 cents or 1.23% to $65.81 a barrel.

Global Markets:

Most European stocks declined on Wednesday as investors are looking ahead to earnings updates from Imperial Brands, Experian, Compass Group, Telefonica and EON.

Germany's annual harmonized inflation rate stood at 2.2% in April, data from the country's Federal Statistical Office showed on Wednesday.

Most Asian shares ended higher as investors closely monitored U.S.-China trade talks, following a rise in key Wall Street benchmarks driven by easing trade tensions between the two global economic superpowers.

Unemployment in South Korea dropped to 2.9% in April from the previous month, marking its fourth straight month of decline and its lowest point since November 2024. Meanwhile, the seasonally adjusted unemployment rate was 2.7% in April, down from 2.9% in March.

Data from the country's national statistics site revealed that the economically active population grew to 29.74 million people, up 0.6% year on year.

South Korea's labor force participation rate stood at 65.1% in April, up 0.1 percentage points year on year.

On Tuesday, the S&P 500 gained 0.7%, and the NASDAQ Composite advanced 1.6%. In contrast, the Dow Jones Industrial Average declined 0.6%.

The U.S. headline Consumer Price Index (CPI) rose 2.3% year-on-year in April, with a monthly increase of 0.2%. Core CPI, which excludes food and energy prices, also rose 0.2% month-on-month, indicating contained inflationary pressures.

The U.S. and China agreed to temporarily reduce tariffs for 90 days. The U.S. will lower its tariff on Chinese goods from 145% to 30%, while China will reduce its retaliatory tariff from 125% to 10%. Additionally, the U.S. will reduce tariffs on lower-value imports from China.

NVIDIA Corporation shares rose 5.6% after CEO Jensen Huang announced the sale of over 18,000 advanced AI chips to Humain, an artificial intelligence startup backed by Saudi Arabia's Public Investment Fund. The chips will support the development of a 500-megawatt data center in the region. The development may influence investor sentiment towards Asian semiconductor stocks.

Boeing Co. shares gained more than 2% after reports indicated that China has lifted a month-long ban on local airlines accepting deliveries of its aircraft.

Stocks in Spotlight:

Bharti Airtel advanced 0.74% after the telecom major's consolidated net profit soared 432.04% to Rs 11,021.8 crore in Q4 FY25 as against Rs 2,071.6 crore reported in Q4 FY24. Revenue from operations increased 27.33% YoY to Rs 47,876.2 crore in Q4 FY25, driven by strong underlying momentum in India, a rebound in reported currency revenue growth in Africa and the full quarter impact of Indus Towers consolidation. Average revenue per user (ARPU) for the quarter stood at Rs 245, up 17.78% over Rs 209 in Q4 FY24.

Tata Motors fell 1.26% after the company's consolidated net profit from continuing operations declined 51.74% to Rs 8,470 crore in Q4 FY25 as compared with Rs 17,552 crore in Q4 FY24. Revenue from operations increased 0.39% YoY to Rs 1,19,503 crore in Q4 FY25.

Garden Reach Shipbuilders & Engineers (GRSE) rallied 14.35% after the company's standalone net profit surged 118.87% to Rs 244.24 crore in Q4 FY25 compared with Rs 111.59 crore in Q4 FY24. Revenue from operations jumped 61.66% YoY to Rs 1642.03 crore during the quarter ended 31st March 2025.

ITD Cementation India surged 11.05% after the company's consolidated net profit jumped 26.9% to Rs 113.55 crore in Q4 FY25 compared with Rs 89.51 crore in Q4 FY24. Revenue from operations increased 9.8% YoY to Rs 2,479.72 crore in the quarter ended 31st March 2025.

Rites surged 5.58% after the company's consolidated net profit jumped 29.19% to Rs 141.33 crore in Q4 FY25 as against Rs 109.39 crore in Q3 FY25. Revenue from operations rose 6.89% to Rs 615.43 crore in the quarter ended 31 March 2025 from Rs 575.76 crore in Q3 FY25.

Apar Industries soared 6.47% after the company's consolidated net profit jumped 5.82% to Rs 249.97 crore on a 16.94% increase in revenue from operations to Rs 5,209.76 crore in Q4 FY25 over Q4 FY24.

K P Energy added 3.14% after the company reported an 84% increase in consolidated net profit to Rs 46 crore on a 94% rise in revenue from operations to Rs 401 crore in Q4 FY25 as compared with Q4 FY24.

Metropolis Healthcare shares fell 5.27% after the company reported a 19.96% decline in consolidated net profit to Rs 29.14 crore for Q4 FY25, compared to Rs 36.41 crore in Q4 FY24. Despite the dip in profit, revenue from operations rose 4.31% year-on-year (YoY) to Rs 345.29 crore for the quarter ended 31 March 2025.

KPI Green Energy hit an upper limit of 5.22% after the company's consolidated net profit surged 142% year-on-year to Rs 104.18 crore in Q4 March 2025. On a consolidated basis, total income stood at Rs 577.80 crore in Q4 FY25, up 97% from Rs 292.97 crore in Q4 FY24, supported by higher project execution, enhanced capacity utilization, and favorable industry dynamics.

Indo Rama Synthetics (India) hit an upper limit of 20% after the company reported a consolidated net profit of Rs 51.07 crore in Q4 March 2025 as against a net loss of Rs 40.48 crore in Q4 March 2024. Net sales rose 32.55% year-on-year to Rs 1,198.47 crore in Q4 of March 2025.

Aditya Birla Capital advanced 6.85% after the company's consolidated net profit jumped 22.11% to Rs 864.60 crore on a 13.30% rise in revenue in Q4 FY25 as against Rs 708 crore in Q3 FY24.

Sai Life Sciences jumped 4.61% after the company's net profit surged 105% to Rs 170 crore on 16% increase in revenue fropm operations to Rs 1695 crore in Q4 March 2025 over Q4 March 2024.

Dalmia Bharat Sugar and Industries surged 8.28% after the company's net profit surged 126% to Rs 206 crore on 36% increase in revenue fropm operations to Rs 1,018 crore in Q4 March 2025 over Q4 March 2024.

Indo Rama Synthetics (India) hit an upper limit of 20% after the company reported consolidated net profit of Rs 51.07 crore in Q4 March 2025 as against net loss of Rs 40.48 crore in Q4 March 2024. Net sales rose 32.55% year-on-year to Rs 1,198.47 crore in Q4 of March 2025.

VIP Industries declined 2.53% after the company's consolidated net loss widened to Rs 27.36 crore in Q4 FY25 as against a net loss of Rs 23.88 crore reported in Q4 FY24. Revenue from operations declined 4.28% year-on-year (YoY) to Rs 494.21 crore in the quarter ended 31 March 2025.

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