Market trades with modest losses; metal stocks rise for third day

The key equity indices were trading with modest losses in mid-afternoon trade. Metal shares extended recent gains. The Nifty was trading tad above the 15,650 mark.

At 14:20 IST, the barometer index, the S&P BSE Sensex, was down 178.96 points or 0.34% to 52,053.47. The Nifty 50 index lost 36.55 points or 0.23% at 15,653.80.

The broader indices outperformed the benchmarks. The S&P BSE Mid-Cap index rose 0.51%. The S&P BSE Small-Cap index added 0.63%.

Buyers outpaced sellers. On the BSE, 1790 shares rose and 1326 shares fell. A total of 147 shares were unchanged.

RBI Policy Outcome:

The Reserve Bank of India (RBI) kept the policy repo rate unchanged at 4% while maintaining its accommodative stance after the conclusion of the Monetary Policy Committee (MPC) meeting today, 4 June 2021.

RBI's MPC began its bi-monthly monetary policy deliberations on Wednesday, 2 June 2021. On the basis of an assessment of the current and evolving macroeconomic situation, the MPC at its meeting today (4 June 2021) decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4%. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35% and the marginal standing facility (MSF) rate and the Bank Rate at 4.25%.

The MPC also decided to continue with the accommodative stance as long as necessary to revive and sustain growth on a durable basis and continue to mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.

These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2%, while supporting growth.

CPI inflation is projected at 5.1% during 2021-22: 5.2% in Q1; 5.4% in Q2; 4.7% in Q3; and 5.3% in Q4:2021-22; with risks broadly balanced. Real GDP growth is projected at 9.5% in 2021-22, consisting of 18.5% in Q1; 7.9% in Q2; 7.2% in Q3; and 6.6% in Q4:2021-22.

Numbers to Track:

In the foreign exchange market, the partially convertible rupee fell to 73.065 compared with its previous closing of 72.9150.

MCX Gold futures for 4 June 2021 settlement shed 0.04% to Rs 48,657.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.07% to 90.57.

The yield on 10-year benchmark federal paper rose to 6.015% from 5.997% recorded at the close of the previous trading session.

In the commodities market, Brent crude for August 2021 settlement rose 39 cents to $71.70 a barrel. The contract had lost 4 cents or 0.06% to settle at $71.31 in the previous trading session.

Buzzing Index:

The Nifty Metal index rose 1.25% to 5,334.15. The index has added 4.15% in three sessions.

NMDC (up 2.77%), Coal India (up 2.85%), APL Apollo Tubes (up 2.52%), Hindustan Zinc (up 2.20%), SAIL (up 1.27%), Ratnamani Metals Tubes (up 1.06%), JSW Steel (up 0.99%), Jindal Steel & Power (up 0.53%) and MOIL (up 0.22%) advanced.

Hindustan Copper (down 1.45%), Mishra Dhatu Nigam (down 0.80%), Welspun Corp (down 0.71%), Hindalco Industries (down 0.44%) and National Aluminum Company (down 0.14%) declined.

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