Monday opened on a double delight for Indian markets as it saw equities surging in early trade while the rupee appreciated against the dollar.
On May 26, shortly after the opening bell, the BSE benchmark Sensex soared by at least 562 points. NSE Nifty jumped by around 176 points.
Automakers Mahindra and Mahindra, and Tata Motors, led the Sensex rally, supported by Titan, ICICI Bank, Tech Mahindra, Power Grid, and Bajaj Finserv.
NTPC gained significantly on the Sensex, too, after it posted better-than-expected fourth-quarter and fiscal results during the weekend. THE WEEK covered the earnings of India’s largest power generation company.
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Adding to the positive earnings sentiment were the early Monsoon and the Reserve Bank of India posting a ₹2.69 lakh crore dividend to the Centre for fiscal 2025. US President Donald Trump pushing the 50 per cent reciprocal tariffs on the EU to July 9 added investor confidence.
Moreover, Niti Aayog CEO B.V.R. Subrahmanyam announcing during the weekend that India surpassed Japan to become the fourth largest economy in the world added to the optimism of the market.
“[The] news of India becoming the fourth largest economy in the world would be a near-term morale boost for the market,” said V.K. Vijayakumar of Geojit Investments.
“RBI’s bumper dividend payment to the government, exceeding the budget estimates, will help contain the fiscal deficit target for FY2026 at 4.4 per cent. This, in turn, can sustain the low inflation and declining interest rate trend, which will continue to support the equity market,” Vijayakumar reasoned.
The rupee jumped by 40 paise to 85.05 versus the dollar in early trade on Monday, May 26.
In major Asian markets, South Korean equities (Kospi) and Japanese stocks (Nikkei 225) were up, while the SSE Composite (Shanghai, China) and Hang Seng (Hong Kong) traded in the red.
India also saw the earliest arrival of the Monsoon since 2009 when the Southwest Monsoon hit Kerala on Saturday, as per the Meteorological Department.
Moreover, investors are looking at the April industrial and manufacturing production data and the first-quarter GDP growth data that is expected to be out this week.
