Key gauges end lower for third straight session

Indian equity benchmarks ended lower for the third straight session on Thursday, in line with weak trends in global markets as the ongoing Iran-Israel conflict continued to weigh on investors' sentiment. The US Fed's decision to keep interest rates unchanged also dampened market sentiment.

Some of the important factors in today’s trade:

India’s CPI likely to be above 3.5 per cent in FY26: Rating agency ICRA has said that India's Consumer Price Index (CPI) is expected to be above 3.5 per cent, while the Wholesale Price Index (WPI) will be over 1.8 per cent for the current fiscal (FY26). It said India’s real GDP growth for 2025-26 will be 6.2 per cent, down from 6.5 per cent in the preceding financial year.

Rupee falls against US Dollar: Indian rupee registered the third straight session of fall against the US dollar, weighed down by the strength of the American currency in the overseas markets and rising crude oil prices.

India core inflation edging up despite headline decline: Ratings agency CRISIL said that headline inflation based on the CPI fell to 2.8 per cent in May, 2025, which is a good omen for the economy. A decline in food inflation is pulling down the headline retail inflation, but core inflation (excluding food and fuel) is edging up. 

India emerging as prime destination for data centre projects, chip manufacturing: Moody's Analytics in its latest report has said that the developed and emerging economies in East and Southeast Asia are key targets for AI investments, with India, Singapore and Malaysia rapidly establishing themselves as prime destinations for data centre projects or chip manufacturing. 

Negative trends in global markets: European markets were trading lower as speculation grew over a possible U.S. involvement in the Israel-Iran conflict. Asian markets settled mostly lower on Thursday after a hawkish commentary from the U.S. Federal Reserve and amid an ongoing geopolitical unrest in Middle East. The Federal Reserve Open Markets Committee's economic projections showed unemployment and inflation rising higher than officials previously thought due to tariff-related uncertainties.

Finally, the BSE Sensex fell 82.79 points or 0.10% to 81,361.87 and the CNX Nifty was down by 18.80 points or 0.08% to 24,793.25.  

The BSE Sensex touched high and low of 81,583.94 and 81,191.04 respectively. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index fell 1.64%, while Small cap index was down by 1.77%.

The lone gaining sectoral index on the BSE was Auto up by 0.42%, while Realty down by 1.63%, Utilities down by 1.61%, PSU down by 1.43%, Power down by 1.24% and Metal down by 1.18% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 1.69%, Titan Company up by 0.74%, Larsen & Toubro up by 0.57%, Bharti Airtel up by 0.56% and Maruti Suzuki up by 0.45%. On the flip side, Adani Ports &Special down by 2.59%, Bajaj Finance down by 2.08%, Tech Mahindra down by 1.95%, IndusInd Bank down by 1.54% and Nestle India down by 1.28% were the top losers.

Meanwhile, expressing an optimism over India-UK trade pact, Commerce and Industry Minister Piyush Goyal has said that the India-UK Free Trade Agreement (FTA) brings ‘stability and predictability’ for businesses in both the countries. He added that this will lead to doubling the bilateral trade in five years. He said ‘That gives confidence to business to start investing in each other’s economy and I think this will also pave the way for greater investments in the two economies, add to our trade in goods and services… India and UK can partner in innovation to work together to bring more resilient supply chains, working with each other, complementing each other and adding value and profits to both countries’.

Goyal arrived in London on a two-day visit to discuss with his UK counterpart Jonathan Reynolds the next steps towards implementation of the Free Trade Agreement (FTA), and explore ways to boost trade and investment between the two countries. In their first joint public intervention since the FTA negotiations concluded last month, UK counterpart Jonathan Reynolds had said he was ‘genuinely excited’ about the prospects opened up with the FTA. He had said that the trade deal is estimated to increase bilateral trade in the long run by GBP 25.5 billion every year – from the current annual estimate of GBP 41 billion – as tariffs are slashed across key sectors on both sides. He noted ‘This trade agreement is a huge economic win for the UK - the biggest trade deal since Brexit and the best deal that India has ever offered’.

The Ministry of Commerce and Industry highlighted significant positive gains for employment in the country, offering a substantial improvement in competitiveness of Indian goods in the UK vis-a-vis other countries as well as easing mobility for professionals. The FTA, announced on May 6 with a target to double trade between the two economies to $120 billion by 2030, is now undergoing a process of legal text formalisation before it can come into force. The commerce ministry said ‘Both leaders will review the progress made in the ongoing FTA negotiations and chart out a clear, time-bound roadmap for its finalisation and implementation’.

The CNX Nifty traded in a range of 24,863.10 and 24,733.40. There were 17 stocks advancing against 33 stocks declining on the index.  

The top gainers on Nifty were Tata Consumer Products up by 2.14%, Eicher Motors up by 1.71%, Mahindra & Mahindra up by 1.58%, Wipro up by 1.30% and Dr. Reddy's Laboratories up by 1.27%. On the flip side, Adani Ports &SEZ down by 2.52%, Bajaj Finance down by 2.29%, Shriram Finance down by 2.08%, Tech Mahindra down by 1.91% and Adani Enterprises down by 1.83% were the top losers.

European markets were trading lower; UK’s FTSE 100 decreased 19.24 points or 0.22% to 8,824.23, France’s CAC fell 45.3 points or 0.6% to 7,610.82 and Germany’s DAX lost 81.25 points or 0.35% to 23,236.56.

Asian markets settled mostly lower on Thursday, with the risk aversion amidst the escalating Israel-Iran geopolitical tensions and on concerns over potential US involvement. Hawkish stance from the Federal Reserve also dulled the investor sentiments. Signs of slow growth in manufacturing and exports of China negatively influenced the investor sentiments. Profit booking mainly in technological and financial sector stocks saddled the local indices. Hang Seng plunged the most among Asian indices, marking its lowest settlement in two weeks.