Sensex jumps 151 pts; PSU bank shares advance
At 12:30 IST, the barometer index, the S&P BSE Sensex, rose 151.35 points or 0.20% to 74,511.36. The Nifty 50 index added 31.95 points or 0.14% to 23,447.45.
In the broader market, the BSE 150 MidCap Index jumped 0.43% and the BSE 250 SmallCap Index rallied 0.32%.
The market breadth was positive. On the BSE, 2,272 shares rose and 1,676 shares fell. A total of 206 shares were unchanged.
RBI MPC Outcome:
The MPC, chaired by RBI Governor Sanjay Malhotra, unanimously voted to maintain the repo rate under the liquidity adjustment facility (LAF) at 5.25%. Accordingly, the standing deposit facility (SDF) rate remains at 5%, while the marginal standing facility (MSF) rate and the bank rate continue at 5.50%. The committee also retained its neutral policy stance.
The RBI noted that the prolonged conflict in West Asia has increased risks to both global growth and inflation. Volatile energy markets, falling crude inventories and rising commodity prices have prompted major central banks to adopt a more cautious approach, with advanced economies expected to lean towards tighter monetary policies.
On the domestic front, economic activity has remained resilient, supported by steady private consumption, sustained investment momentum, robust services exports and strong merchandise export growth in April 2026. However, higher freight and insurance costs, coupled with geopolitical uncertainties, are beginning to weigh on the economy. The central bank also flagged concerns over a deficient south-west monsoon, though various government initiatives are expected to help mitigate the impact on agriculture and rural demand.
Taking these factors into account, the RBI revised its FY27 real GDP growth forecast to 6.6% from 6.9% projected earlier. Growth is now estimated at 6.6% in Q1, 6.3% in Q2, 6.5% in Q3 and 6.8% in Q4. The central bank said prolonged supply chain disruptions, volatility in global financial markets and weather-related shocks remain key downside risks to growth.
CPI inflation for FY27 has been projected at 5.1%, compared with the earlier estimate of 4.6%. Quarterly inflation is expected at 4.2% in Q1, 5.1% in Q2, 5.9% in Q3 and 5.4% in Q4, while core inflation is projected at 4.7% for the year.
The RBI highlighted that elevated energy prices, global supply constraints, a weaker monsoon outlook and the risk of El Ni?o have increased inflation uncertainties. Given these evolving risks, the MPC decided that maintaining the current policy rate and stance would be appropriate until greater clarity emerges.
The minutes of the MPC meeting will be published on 19 June 2026. The next MPC meeting is scheduled for 3 to 5 August 2026.
Economy
The government has announced a series of reforms to attract long-term foreign capital and deepen India's capital markets, including exempting Foreign Portfolio Investors (FPIs) from income tax on interest income and capital gains arising from investments in government securities (G-Secs) with effect from 01 April 2026. Similar tax benefits have been extended to the Bank for International Settlements (BIS). The government has also expanded foreign investor access to government bonds by including additional long-tenor securities and Sovereign Green Bonds under the Fully Accessible Route (FAR), while removing certain investment restrictions under the General Route. At the same time, investment norms for individual Persons Resident Outside India (PROIs) have been liberalised, allowing them to invest in listed Indian equities through the Portfolio Investment Scheme with higher investment limits. The Finance Ministry said the measures are aimed at simplifying market access, enhancing ease of doing business and attracting stable foreign inflows into India's equity and debt markets.
Derivatives:
The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, fell 2.12% to 15.55. The Nifty 30 June 2026 futures were trading at 23,516.20, at a premium of 68.75 points as compared with the spot at 23,447.45.
The Nifty option chain for the 30 June 2026 expiry showed a maximum call OI of 90.5 lakh contracts at the 25,000 strike price. A maximum put OI of 54.8 lakh contracts was seen at the 24,000 strike price.
Buzzing Index:
The Nifty PSU Bank index rose 1.28% to 8,324.45. The index jumped 3.94% in the four trading sessions.
Indian Bank (up 2.48%), Bank of India (up 2.06%), Canara Bank (up 2.01%), Punjab & Sind Bank (up 1.93%) and Punjab National Bank (up 1.83%), Central Bank of India (up 1.39%), UCO Bank (up 1.24%), Union Bank of India (up 0.73%), State Bank of India (up 0.7%) and Indian Overseas Bank (up 0.36%) jumped.
On the other hand, Bank of Baroda (down 1.99%), Bank of Maharashtra (down 0.26%), edged lower.
Stocks in Spotlight:
Bharat Heavy Electricals added 1.42% after the company received a notification of award (NOA) from Meja Urja Nigam (MUNPL) for the 3x800 MW Meja Supercritical Thermal Power Project Stage-II EPC package.
PTC India Financial Services rose 1.59% after the company re-designated Rajiv Malhotra as managing director (MD) and chief executive officer (CEO) with additional charge, effective July 1, 2026.
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