Indices open higher in early trade; breadth strong

The key equity indices traded with major gains in early trade, driven by U.S. President Donald Trump issued and then softened threats of increased tariffs on European imports over the weekend. Investors will closely watch the global trade development and upcoming Q4 results from various companies. The Nifty traded above the 25,000 level.

All the sectoral indices on the NSE were traded in green with auto, metal and consumer durable shares advancing the most.

At 09:25 IST, the barometer index, the S&P BSE Sensex, added 555 points or 0.68% to 82,276.08 The Nifty 50 index advanced 186.40 points or 0.75% to 25,036.55.

In the broader market, the S&P BSE Mid-Cap index advanced 0.63% and the S&P BSE Small-Cap index jumped 0.79%.

The market breadth was strong. On the BSE, 2,211 shares rose and 779 shares fell. A total of 178 shares were unchanged.

Foreign portfolio investors (FPIs) bought shares worth 1,794.59 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 299.78 crore in the Indian equity market on 23 May 2025, provisional data showed.

Economy:

The Reserve Bank of India (RBI) on Friday handed the government a whopping Rs 2.68 lakh crore in surplus for FY25, 27% more than last year and even higher than what the Union Budget had estimated. Analysts suggest that this additional amount could support the governments objective of reducing the fiscal deficit to 4.4% for the current financial year.

Stocks in Spotlight:

JSW Steel rose 0.74%. The company reported a 15.7% year-on-year (YoY) increase in consolidated net profit to Rs 1,503 crore for the quarter ended 31 March 2025, compared to Rs 1,299 crore in the corresponding period last year. Revenue from operations declined 3.13% YoY to Rs 44,819 crore in Q4 FY25.

Narayana Hrudayalaya rallied 4.56% after the company reported a 3.41% rise in consolidated net profit to Rs 197.21 crore on an 18.39% increase in revenue from operations to Rs 1,475.44 crore in Q4 FY25 over Q4 FY24.

Ruchira Papers surged 8.95% after the companys standalone net profit surged 90.76% to Rs 18.39 crore on 1.04% rise in revenue from operations to Rs 161.68 crore in Q4 FY25 over Q4 FY24.

Numbers to Track:

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 85.0075, compared with its close 85.4500 during the previous trading session.

MCX Gold futures for 5 June 2025 settlement fell 0.44% to Rs 95,373.

The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.32% to 98.79.

The United States 10-year bond yield advanced 0.31% to 4.544.

In the commodities market, Brent crude for July 2025 settlement added 22 cents or 0.34% to $65 a barrel.

Global Markets:

The US Dow Jones index futures were currently up by 374 points, signaling a strong opening for US stocks today.

Asian stocks were mixed on Monday after U.S. President Donald Trump issued and then softened threats of increased tariffs on European imports over the weekend. Japanese equities extended recent gains, while technology shares across the region, particularly those supplying Apple Inc., declined.

Investor sentiment was weighed down by concerns that Trump may impose a 25% tariff on all iPhones and other smartphones manufactured overseas. The remarks added pressure to tech stocks in Asia, many of which are key suppliers in Apple's global production chain.

Broader Asian markets also tracked the losses seen on Wall Street last Friday, when Trump initially announced plans to impose 50% tariffs on European Union goods. However, on Sunday, he stated that implementation would be delayed until July 9.

Reports indicate that Japanese trade officials will visit Washington in early June for a fourth round of bilateral trade discussions. Despite ongoing talks, Japan has maintained its position that the United States should remove all existing tariffs on Japanese exports.

U.S. market ended lower on Friday following the renewed trade rhetoric. The Dow Jones Industrial Average fell 0.61%, the S&P 500 dropped 0.67%, and the NASDAQ Composite declined 1%.

In a post on Truth Social, Trump stated that he would recommend a 50% tariff on all EU imports starting June 1, citing a lack of progress in trade negotiations. He wrote, "The European Union, which was formed for the primary purpose of taking advantage of the United States on TRADE, has been very difficult to deal with," Trump said on Truth Social social media site. "Our discussions with them are going nowhere!"

Earlier in the year, the administration had imposed a series of tariffs on EU goods, including a 25% duty on automobiles, steel, and aluminium in March, followed by a 20% tariff on additional products in April. These were later reduced temporarily to allow space for further negotiations. In response, the EU suspended planned retaliatory tariffs and proposed eliminating duties on all industrial goods traded between the two sides.

Trump also announced that iPhones sold in the U.S. would need to be manufactured domestically or face a 25% import tariff. This marked the first time in 2025 that a specific company has been singled out in U.S. trade policy. Apple shares fell more than 3% in premarket trading, contributing to a broader decline in technology stocks.

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