Financials Take Heart from RBI Pause Even as IT And Metals Bash Markets

Mumbai, June 5:Indian equities ended a volatile session with a mixed sectoral performance after the Reserve Bank of India (RBI) kept the repo rate unchanged at 5.25% and unveiled measures to support the rupee, prompting investors to rotate into financial stocks while trimming exposure to information technology and metal counters.

Financials, PSU Banks seem Happy after RBI Policy

Financial stocks emerged among the biggest beneficiaries of the policy outcome. Nifty Bank index gained 0.3%, while PSU banks advanced 0.5% as investors welcomed the RBI’s decision to support the rupee through capital inflow measures rather than higher interest rates. Stable borrowing costs are expected to help sustain credit demand and ease concerns over funding pressures.

Nifty Bank index advanced as stocks smiled on policy day. Source: NSE

Among individual stocks, Axis Bank and Bajaj Finance attracted buying interest, helping cushion the benchmarks from sharper declines. Axis Bank share price added 1.5% while Bajaj Finance share price rose 1.7%. Broader banking sentiment was also supported by expectations that foreign inflow measures could improve liquidity conditions and support bond markets.

Media Stocks Steal the Show

The Nifty Media index outperformed all sectoral gauges, climbing about 3.5% as investors piled into broadcasting and entertainment names. Zee Entertainment Enterprises was among the standout gainers after optimism surrounding its sports-content expansion strategy and potential FIFA World Cup broadcasting rights boosted sentiment. Zee Entertainment Enterprises share price added 7%.

Consumer Durables and Healthcare indices also posted gains of around 0.5% each, reflecting selective buying in domestic consumption-oriented sectors.

Realty Stocks get Lit from RBI Pause

Rate-sensitive realty stocks took heart from RBI holding key rate as their index advanced 0.6% amid expectations of a stable credit environment aiding the sector. Lodha Developers share price rose 1.4% while Prestige Estates Projects share price increased 1.8% even as DLF share price flatlined despite a favourable policy announcement.

IT Stocks Remain Under Pressure

Information technology shares remained a drag on the benchmarks, extending their recent weakness. The sector also tracked overnight weakness in U.S. technology stocks following a selloff in semiconductor names.

Nifty IT index extended its slide after overnight tech jitters on Wall Street. Source: NSE

Heavyweights Tata Consultancy Services (TCS) and Wipro featured among the top Nifty losers, highlighting continued investor caution toward export-oriented technology companies. The Nifty IT index was among the weakest-performing sectoral gauges during the session.

Metals, Energy Stocks Decline

Broader markets showed more weakness as Nifty Midcap 100 declined 0.4% versus benchmark Nifty 50 falling 0.2%. Source: NSE

Metal shares posted their worst performance on the Nifty 50, with Hindalco Industries emerging among the worst performers on the benchmark index. Investors remained wary of slowing global growth prospects and softer commodity demand, which weighed on sentiment across the sector. Adani Enterprises jumped over 2% but that did little to prevent the index’s decline. Hindustan Zinc crashed after on buzz thatthe Centre isplanning to sell 2% stake for Rs 5,000 crore in the metals major.

Energy, Oil & Gas and Telecom stocks declined between 0.5% and 1.5%, reflecting concerns over elevated crude oil prices and their potential impact on corporate margins. Rising geopolitical tensions in West Asia and higher energy costs continue to be key risks for the market.

Broader markets were subdued, as the Nifty Midcap 100 index fell 0.4%, while the Nifty Smallcap 100 index was little changed.

Source:

• NSE