3 days ago
- Business
- Business Recorder
Indian shares muted as pullback in financials offsets broader gains
Indian benchmark indexes closed flat on Tuesday as profit booking in financials offset gains driven by optimism around the U.S.-China trade talks and continued policy support from the Reserve Bank of India.
The Nifty 50 closed little changed at 25,104.25, while the Sensex ended fell a marginal 0.06% to end at 82,391.72.
Both indexes rose about 0.4% in early trade before losing steam.
Valuations are stretched after the recent rally, making time correction and bouts of profit-taking likely in the near term, said Amit Jain, co-founder of Ashika Global Family Office.
Both the benchmark indexes gained about 2.3% in the last four sessions, with Nifty logging its highest closing levels since October 14 on Monday, buoyed by the RBI's policy support.
Seven of the 13 sub-sectors logged losses on the day. High-weightage financials and banks lost about 0.5% and 0.4%, respectively.
Index heavyweights HDFC Bank and ICICI Bank dropped 0.7% and 0.8%, contributing to the drag.
Indian equity mutual fund inflows slump to 13-month low in May despite market gains
Analysts attributed the fall to profit-booking – rate sensitive sectors such as financials gained 2.8% in the last four sessions and the bank index rose 2.2%, both hitting a record high on Monday.
The broader, the more domestically focussed small-caps and mid-caps were also muted on the day.
Other Asian markets advanced, aided by expectations of progress on day two of trade talks between U.S. and China.
IT companies, which earn a significant share of their revenue from the U.S., rose 1.7% on optimism over the trade negotiations.
Among individual stocks, Grasim added 3.7% after Morgan Stanley raised its target price to a Street-high 3,500 rupees and made the stock its top pick.
Coforge rose about 2% after JPMorgan reiterated the company as its top IT pick, citing strong growth prospects in fiscal 2026.
Tata Power rose 1.7% after its solar manufacturing arm crossed 4 GigaWatt of solar module production at its Tamil Nadu facility.
