Equity & Indian Market Developments

 

• Indian equities witnessed a second consecutive week of correction, with Nifty 50 declining 0.77% and Sensex falling 0.71%, amid tariff concerns, uncertainty surrounding US-Iran negotiations, and cautious sentiment following the RBI policy review.

 

• Broader markets underperformed, with Nifty Midcap 150 down 1.42% as investors rotated away from higher-beta segments.

 

• India VIX declined 2.5% to 15.79, indicating moderation in near-term volatility despite market weakness.

 

• Sectorally, Media (+6.7%), Consumer Durables (+1.5%) and PSU Banks (+1.3%) outperformed, while Financial Services ex-Banks (-3.3%), FMCG (-2.2%), Realty and Metals remained under pressure.

 

 

Global Market Developments

 

• Global markets delivered mixed performance as investors balanced strong economic data against interest-rate and geopolitical concerns.  In US, the Dow Jones gained 1.7%, while the Nasdaq slipped marginally due to profit-booking in technology and AI-related stocks.

 

• European markets were mixed, while Asian markets remained volatile amid supply-chain concerns and regional trade uncertainties.

 

• Investors continued to monitor tariff developments, US-Iran negotiations, inflation trends and central bank policy signals globally.

 

 

 

Fixed Income & Debt Market

 

 

• The RBI maintained the repo rate at 5.25% and retained its neutral policy stance, while revising FY27 GDP growth lower to 6.6% and raising its inflation forecast to 5.1%.

 

• Bond markets gained on expectations of favourable tax treatment for foreign investors and RBI measures aimed at attracting overseas capital inflows.

 

• The 10-year benchmark G-Sec yield eased 3 bps to 6.98%, reflecting improved demand for government securities.

 

 

Commodity Updates

 

• Gold   - Gold corrected sharply, declining nearly 4% during the week, as stronger US employment data and persistent inflation concerns reduced expectations of near-term rate cuts.  Elevated interest-rate expectations and a stronger US dollar weighed on investor sentiment towards bullion.

 

• Silver   - Silver recorded its steepest weekly decline since March 2026, falling over 8%, amid broad-based selling across precious and industrial metals.

 

 

• Crude Oil   - Crude oil rebounded, with NYMEX crude gaining 3.1% WoW, supported by geopolitical uncertainty and supply concerns.  Gains were capped by weak Chinese demand and optimism around a potential US-Iran agreement that could improve global oil supply.

 

• Copper   - Copper declined over 2% during the week due to profit-booking and a stronger US dollar.  Despite the correction, the medium-term outlook remains supported by infrastructure spending, energy-transition investments and supply-side constraints.

 

Macro Economic Updates

 

• India's Q4 FY26 GDP grew 7.8% YoY, supported by continued strength in manufacturing and domestic demand.

 

• Manufacturing PMI rose to 55.0, Services PMI to 59.8 and Composite PMI to 59.3, indicating strong business activity and economic momentum. Whereas Industrial production (IIP) expanded 4.9% YoY in April 2026, led by robust manufacturing growth.

 

• GST collections stood at ₹1.94 lakh crore in May 2026, up 3.2% YoY, reflecting continued economic activity. On the other hand India's forex reserves remained robust at approximately USD 682 billion, providing a strong external buffer.

 

• The rupee ended the week at ₹94.94 per US dollar, reflecting continued global currency volatility.

 

 

 

Best Regards

 

Alpha Research

 

Disclaimer: This report is for informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any financial instrument. The information is based on publicly available sources believed to be reliable, but accuracy and completeness are not guaranteed. Views expressed are subject to change without notice. Investors should conduct their own due diligence and consult a qualified financial advisor before making investment decisions.