Nifty above 25,500 level; oil & gas shares in demand

The key equity benchmark traded with small gains in early afternoon trade, witnessing a volatile session, despite optimism over a potential US-India trade deal and favorable global cues. Focus remained on foreign inflows and the upcoming end of the US tariff reprieve. The Nifty climbed above the 25,500 level. Oil & gas stocks rebound after previous session decline.

At 12:30 IST, the barometer index, the S&P BSE Sensex, advanced 75.28 points or 0.09% to 83,681.74. The Nifty 50 index added 24.60 points or 0.10% to 25,540.

The broader market underperformed the frontline indices. The S&P BSE Mid-Cap index declined 0.28% and the S&P BSE Small-Cap index fell 0.26%.

The market breadth was negative. On the BSE, 2,003 shares rose and 1,822 shares fell. A total of 185 shares were unchanged.

Economy:

The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI)' rose to a 14-month high of 58.4 in June, up from 57.6 in May. The headline figure was above its long-run average of 54.1 and pointed to a substantial improvement in the health of the sector. The manufacturing sector experienced a strong end to the first fiscal quarter, marked by improved trends in output and new orders, alongside a record upturn in employment.

June also saw a quicker upturn in new order inflows. The rate of expansion was the strongest in close to a year. According to panel members, the increase was supported by marketing efforts and a substantial rise in exports.

India's industrial output growth fell to a nine-month low of 1.2% in May 2025, dragged down by weak performance in the manufacturing, mining, and electricity sectors, data released by the National Statistical Office (NSO) on Monday showed. The factory output, measured by the Index of Industrial Production (IIP), had grown 6.3% in May 2024, while the April 2025 estimate has been revised to 2.6%, slightly down from the earlier 2.7%. According to the data, manufacturing'which forms over three-fourths of the IIP ' grew 2.6% in May, down from 5.1% a year ago. Mining output shrank 0.1%, reversing a 6.6% expansion in May last year. Electricity generation saw a sharp contraction of 5.8% compared to a robust 13.7% growth a year ago.

India's gross collection of goods and services tax (GST) hit an all-time high of Rs 22.08 lakh crore in the financial year 2024-25, marking a 9.4% year-on-year (YoY) growth compared to the previous financial year, according to an official statement on Monday, 30 June 2025. On 1 July 2025, India will mark the completion of eight years since the implementation of the GST.

India's fiscal deficit for the first two months of FY26 stood at Rs 13,163 crore, or just 0.8% of the full-year target of Rs 15.69 lakh crore, according to data released by the Controller General of Accounts on Monday. The year-ago deficit for the same period was significantly higher at Rs 50,600 crore.

Derivatives:

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, fell 2.13% to 12.51. The Nifty 31 July 2025 futures were trading at 25,656.80, at a premium of 116.8 points as compared with the spot at 25,540.

The Nifty option chain for the 31 July 2025 expiry showed a maximum call OI of 41.9 lakh contracts at the 26,000 strike price. Maximum put OI of 66.4 lakh contracts was seen at 25,000 strike price.

Buzzing Index:

The Nifty Oil & Gas index rose 0.20% to 11,824.20. The index fell 0.29% in the past trading session.

Castrol India (up 1.81%), Gujarat State Petronet (up 1.26%), Reliance Industries (up 1.25%) and Gujarat Gas (up 0.25%) advanced.

On the other hand, Aegis Logistics (down 5.13%), Indraprastha Gas (down 1.34%) and Oil & Natural Gas Corpn (down 0.88%) edged lower.

Stocks in Spotlight:

VST Tillers Tractors added 1.70% after the company's total sales surged 92.69% to 7,149 units in June 2025 from 3,710 units sold in June 2024.

Escorts Kubota rose 0.10%. The company said that its Agri Machinery Business has sold 11,498 tractors in June 2025, registering a growth of 2.2% as compared with 11,245 tractors sold in June 2024.

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