Closing Bell: Sensex Ends Flat, Nifty 50 Holds Above 23,400 Ahead of RBI Policy; Rajesh Exports Falls 5%

Market Update at 04:10 PM: Indian equity benchmarks ended marginally higher on Thursday, June 4, amid heightened geopolitical tensions in the Middle East and mixed signals surrounding a potential ceasefire. Investors remained cautious ahead of the Reserve Bank of India's (RBI) monetary policy decision, while reports regarding Taxation of foreign institutional investor (FII) holdings in government securities added to market uncertainty.

According to reports, FII investments in government securities may be exempt from taxes. However, sentiment turned volatile after another report suggested that the government could introduce an ordinance imposing a 20 per cent withholding tax and a 12.5 per cent capital gains tax on such investments.

The Nifty 50 opened 123 points lower and slipped to an Intraday low of 23,247.30 before recovering strongly through the session. The benchmark index rebounded more than 150 points from the day's low to reclaim the 23,400 level. At the close, the Nifty 50 settled at 23,416.55, up 10.95 points or 0.05 per cent. The Sensex gained 13.84 points, or 0.02 per cent, to finish at 74,360.01.

The Bank Nifty extended its winning streak for a third consecutive session, closing 0.22 per cent higher. Meanwhile, the India VIX, often referred to as the market's fear gauge, declined 2.4 per cent, indicating easing volatility expectations.

Global crude oil prices eased on Thursday, with Brent crude futures falling nearly 1 per cent to below USD 97 per barrel. The decline snapped a three-day rally as hopes for a diplomatic breakthrough with Iran improved modestly. Market sentiment was supported by reports that Israel and Lebanon had agreed to a ceasefire, subject to Hezbollah halting its attacks.

Sectoral performance remained largely positive, with 9 of the 11 major sectoral indices ending in the green. The broader market also outperformed, as the Nifty Midcap 100 index rose 0.46 per cent and the Nifty Smallcap 100 index advanced 0.49 per cent.

The Nifty Media index emerged as the top-performing sector, climbing 2.19 per cent, with five of its 10 constituents ending higher. On the other hand, the Nifty Metal index was the worst performer, declining 0.73 per cent and extending losses for a second straight session. The Nifty IT index witnessed sharp selling pressure and tumbled 5.57 per cent during the session.

Among individual stocks, Rajesh Exports fell 5 per cent after the Securities and Exchange Board of India (SEBI) barred the company and its promoter, alleging inflation of revenue worth Rs 15.15 lakh crore through unverified overseas entities.

Agarwal Industrial Corporation surged 20 per cent after securing a USD 49 million bitumen supply order from Hindustan Petroleum Corporation Limited (HPCL). PhysicsWallah jumped 15.67 per cent after the company shifted its student loan model towards partnerships with non-banking financial companies (NBFCs).

The biggest contributors to the Nifty 50's gains were ICICI Bank, which added 15.12 points, Titan Company, which contributed 12.75 points, and Eternal, which added 11.57 points. Meanwhile, Trent weighed the most on the benchmark index by 68.75 points, followed by Infosys at 16.28 points and Reliance Industries at 13.98 points.

Market breadth remained favourable on June 4. Of the 3,396 stocks traded on the NSE, 1,817 advanced, 1,474 declined and 105 remained unchanged.

A total of 103 stocks touched their 52-week highs, while 56 stocks hit their 52-week lows. Additionally, 145 stocks were locked in their Upper Circuits, compared to 102 stocks that hit Lower Circuits.

Despite geopolitical concerns and uncertainty over taxation policies, the domestic market managed to recover from early losses and close in positive territory, reflecting resilience in broader investor sentiment ahead of the RBI policy outcome.

Market Update at 2:29 PM: Indian equity benchmarks traded in a narrow range during the afternoon session on Thursday as investors largely stayed on the sidelines ahead of the Reserve Bank of India's Monetary Policy Committee (MPC) decision, which is scheduled to be announced on Friday.

At around 2:00 PM, the Nifty 50 was trading flat at 23,401, while the Sensex was marginally lower by 9.95 points, or 0.01 per cent, at 74,356.12.

The broader market continued to outperform the frontline indices. The Nifty MidCap index advanced 0.78 per cent, while the Nifty SmallCap index gained 0.53 per cent, reflecting sustained buying interest in mid- and Small-Cap stocks.

Among sectoral indices, the Nifty Consumer Durables index emerged as the top performer, rising more than 2 per cent. The Nifty Pharma and Nifty Realty indices also traded in positive territory and outperformed the broader market.

On the other hand, the Nifty Metal index lagged its peers and remained under pressure during the session.

Market participants remained cautious ahead of the RBI's policy announcement, with expectations centred on the central bank's commentary on inflation, growth outlook, and interest rate trajectory.

Market Update at 12:14 PM: Indian benchmark equity indices traded in a narrow range during the afternoon session on Thursday as investors largely remained on the sidelines ahead of the Reserve Bank of India's Monetary Policy Committee (MPC) decision, which is scheduled to be announced on Friday.

As of 12:00 PM, the Nifty 50 was up 11.75 points, or 0.05 per cent, at 23,423, while the Sensex gained 43.85 points, or 0.06 per cent, to trade at 74,391.09.

Broader markets continued to outperform the benchmark indices. The Nifty MidCap index advanced 0.67 per cent, while the Nifty SmallCap index rose 0.57 per cent, reflecting sustained buying interest in the broader market segment.

On the sectoral front, information technology, Real Estate and private banking stocks witnessed mild selling pressure. The Nifty IT, Nifty Realty and Nifty Private Bank indices were among the key laggards during the session.

Meanwhile, consumer-focused and energy-related stocks led the gains. The Nifty Consumer Durables, Nifty Oil & Gas and Nifty Chemical indices emerged as the top-performing sectoral indices, supporting overall market sentiment.

Market participants remained cautious as they awaited the RBI's policy announcement for cues on interest rates, inflation outlook and economic growth projections, which could influence the market's near-term direction.

Market Update at 09:35 AM: Indian equity benchmark indices opened lower on Thursday, extending their losses in early trade as renewed geopolitical tensions between the U.S. and Iran weighed on global market sentiment.

At around 9:19 AM, the Nifty 50 was trading 52.65 points, or 0.22 per cent lower, at 23,355.10. The Sensex also declined 126.59 points, or 0.17 per cent, to 74,219.58.

The weakness was not limited to frontline indices. Broader markets also witnessed selling pressure, with the Nifty MidCap index trading 0.22 per cent lower and the Nifty SmallCap index down 0.15 per cent during the session.

Investor sentiment remained cautious amid escalating tensions in the Middle East. Iran reportedly struck the Kuwait International Airport early Wednesday. The development came a day after the U.S. Central Command stated that it had intercepted multiple ballistic missiles launched by Iran and carried out defensive strikes on Qeshm Island in the Persian Gulf.

Market participants are closely monitoring geopolitical developments, as any further escalation could impact global risk appetite and energy prices.

Adding to the uncertainty, investors are also awaiting the outcome of the Reserve Bank of India's Monetary Policy Committee (MPC) meeting, which is scheduled to be announced on Friday. The policy decision is expected to provide cues on interest rates and the central bank's outlook on economic growth and inflation.

Meanwhile, U.S. President Donald Trump said during a media interaction that Iran had agreed not to possess nuclear weapons. Separately, the U.S. administration stated that Israel had agreed to a ceasefire with Lebanon, provided Hezbollah also halts hostilities.

With global geopolitical risks and the upcoming RBI policy announcement in focus, investors are expected to remain cautious in the near term.

Pre-Market Update at 7:45 AM: Indian benchmark indices Sensex and Nifty 50 are expected to open on a weak note on Thursday, June 4, amid negative global cues and continued uncertainty surrounding the escalating U.S.-Iran conflict. Investor sentiment remained cautious as geopolitical tensions kept crude oil prices elevated and raised concerns about inflationary pressures across global economies.

Gift Nifty was trading around the 23,317 level, indicating a negative opening for domestic equities. Asian markets traded lower, while Wall Street ended sharply in the red overnight as investors reacted to developments in the Middle East and their potential impact on global growth and inflation.

The geopolitical situation remains a key trigger for markets. Iran's Foreign Minister said talks aimed at ending the conflict had produced no tangible progress, while fresh military strikes by both the U.S. and Iran added pressure on an already fragile ceasefire. However, U.S. President Donald Trump expressed optimism that a breakthrough could be achieved over the weekend. Separately, Israel and Lebanon agreed to implement a ceasefire, although both sides stressed that lasting peace would depend on a complete halt to hostilities by Iran-backed Hezbollah.

The latest U.S. Federal Reserve Beige Book survey highlighted that while artificial intelligence-led investments continue to support economic activity, rising costs linked to the Middle East conflict are contributing to inflationary pressures. Higher energy prices have affected several sectors, including shipping, packaging, groceries and fertilizers.

Economic data from the U.S. also remained supportive. The Institute for Supply Management reported that the non-manufacturing Purchasing Managers' Index (PMI) rose to 54.5 in May from 53.6 in April, exceeding market expectations of 53.8 and indicating stronger activity in the services sector.

Institutional activity remained mixed. Foreign Institutional Investors (FIIs) were net sellers on June 3, offloading equities worth Rs 5,616.56 crore. Domestic Institutional Investors (DIIs) offset the selling pressure by purchasing shares worth Rs 5,740.89 crore.

In the commodities market, gold prices advanced as a weaker U.S. dollar and softer oil prices boosted safe-haven demand. Spot gold rose 0.4 per cent to USD 4,450.16 per ounce, while U.S. gold futures for August delivery gained 0.2 per cent to USD 4,477 per ounce.

Crude oil prices eased after Israel and Lebanon reached a ceasefire agreement, raising hopes of a broader de-escalation in the region. Brent crude futures fell 0.69 per cent to USD 97.14 per barrel, while U.S. West Texas Intermediate crude slipped 0.65 per cent to USD 95.40 per barrel. Meanwhile, the Dollar Index remained near a two-month high at 99.47.

From a derivatives perspective, the Put-Call Ratio (PCR) for the Nifty 50 June expiry stood at 0.98. Significant Put open interest was concentrated at the 23,300 strike, while the highest Call open interest among nearby out-of-the-money strikes was seen at 24,000, suggesting it could act as a key resistance level.

Technically, immediate resistance for the Nifty 50 is placed at 23,560, which marks the neckline of a potential double-bottom pattern. A sustained move above this level may open the door for gains toward the 50-day moving average at 23,685 and the 20-day moving average at 23,737. On the downside, immediate support is seen at 23,230, followed by a stronger support zone near 23,100.

In the derivatives segment, Amber Enterprises India and Kaynes Technologies remain under the F&O ban list for June 4.

On Wednesday, Indian equities ended lower but recovered significantly from intraday lows. The Sensex declined 303.67 points, or 0.41 per cent, to close at 74,346.17, while the Nifty 50 fell 77.95 points, or 0.33 per cent, to settle at 23,405.60.

Wall Street also witnessed broad-based selling. The Dow Jones Industrial Average dropped 620.72 points, or 1.21 per cent, to 50,687.07. The S&P 500 fell 56.06 points, or 0.74 per cent, to 7,553.72, while the Nasdaq Composite lost 239.92 points, or 0.89 per cent, to close at 26,853.98.

Among major technology stocks, Nvidia declined 3.62 per cent, Microsoft fell 3.17 per cent, Amazon lost 2.53 per cent and Apple slipped 1.57 per cent. On the positive side, AMD gained 4.02 per cent and Meta Platforms advanced 4.24 per cent. IBM was among the worst performers, plunging 7.17 per cent. Semiconductor stocks delivered mixed performance, with Marvell, Intel, Qualcomm and Sandisk gaining between 3.7 per cent and 6.7 per cent.

Disclaimer: The article is for informational purposes only and not investment advice.

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