On May 5, 2025, Indian equity indices Sensex and Nifty traded higher, buoyed by easing global trade tensions and continued foreign inflows. The benchmark indices extended their winning streak to the longest so far in 2025, supported by growing optimism around a potential India-U.S. trade deal. The Sensex settled 294 points higher, while the Nifty surpassed the 24,450 mark.
At 10:46 AM, Nifty50 was trading at 24,515.75, up 169 points or 0.69%, and BSE Sensex was at 81,008.97, up 507 points or 0.63%. Market analysts anticipate share-specific movements to lead trading activities, with possible fluctuations due to global political issues. Important financial results are scheduled from Mahindra & Mahindra, Indian Hotels, Coforge, and CAMS.
VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, noted, “The reversal in FII strategy in India from selling to buying continued for the week ending May 2. During the first three months of 2025, FIIs sold equity for Rs 129,680 crores. However, during the last 12 trading days, FIIs have been sustained buyers in the cash market, having bought equities for Rs 40,145 crores cumulatively. This is a major pivot in FII strategy, which will impart resilience to the market.”
Concerns linger regarding India's retaliatory actions following a recent terrorist strike, which could restrict the FII-led rally. Nonetheless, the steep decline in the Dollar index from 111 on January 11 to 99 recently continues to act as a strong tailwind for the market. The outperformance of large caps over the broader market is a healthy trend that is currently playing out.
US equities rose on Friday, achieving gains for two consecutive weeks, supported by robust economic indicators and potential improvements in US-China trade relations. Oil prices declined in early trades following OPEC+'s weekend decision to increase production volumes. Asian markets opened cautiously, with several major exchanges closed for holidays. Gold prices moved upward on May 5, benefiting from the dollar's weakness, as market participants sought clarity on trade relations between the U.S. and its trading partners while anticipating the Federal Reserve's policy announcement later this week.
On May 5, 2025, the market ended at its highest closing level of 2025, with Nifty above 24,450. Big gains were seen in broader markets, with the midcap index surging 2%. The market breadth was firmly in favor of advances, with an advance-decline ratio of 5:2. The Nifty Bank underperformed as SBI and Kotak slipped on mixed Q4 results.
At the close, Sensex was up 294.85 points or 0.37% at 80,796.84, and Nifty was up 114.45 points or 0.47% at 24,461.15. About 2,462 shares advanced, 1,404 shares declined, and 171 shares remained unchanged. BSE midcap and smallcap indices added more than a percent each. Except for bank stocks, all other sectoral indices ended in the green, with auto, power, energy, consumer durables, metal, FMCG, and oil & gas up 1% each.
Among the top gainers on the Nifty were Adani Ports, Adani Enterprises, Trent, Shriram Finance, and Mahindra & Mahindra, while the losers included Kotak Mahindra Bank, ONGC, Dr. Reddy's Laboratories, JSW Steel, and SBI. Notably, shares of Adani Enterprises were up 7%, and Trent saw a rise of 4%.
The shares of Mahindra & Mahindra were in focus after the company released its quarterly results, showing a net profit rise of 20% on strong sales momentum driven by robust automobile and tractor sales. The company reported a consolidated net profit of ₹3,295 crore for the quarter ended March 2025, up from ₹2,754 crore in the previous year. The board recommended a dividend of ₹25.3.
Meanwhile, the shares of RR Kabel soared by over 14% on the opening hours of May 5, following a 26% jump in revenue and an increase in margin. The current price of RR Kabel stands at ₹1,159.60. Biocon’s shares surged by close to 5%, following the company’s securing of multiple market access agreements for its biosimilar drug Yesintek, which is used for treating chronic autoimmune diseases.
In other news, the shares of Central Depository Services Ltd. (CDSL) fell as much as 4% on May 5 in reaction to its quarterly results for the January-March period, which saw a revenue decline of 19.3% to ₹224.4 crore.
The shares of Kotak Mahindra Bank dipped about 4% on Monday after the company announced its Q4 results on May 3, which showed a 14% decline in profit. SBI shares also dropped by around 2% after reporting a slightly soft quarter, with credit growth moderating to 12.4% year-on-year due to pre-payments in the corporate loan book.
As the day progressed, the Indian rupee ended 32 paise higher at 84.24 per dollar, compared to the previous close of 84.56. This rise in the rupee, coupled with the gains in the stock market, reflects a positive sentiment among investors despite the backdrop of global uncertainties.
Market analysts predict that share-specific movements will dominate trading activities, with fluctuations expected due to ongoing global political issues and the anticipation of upcoming financial results. The sentiment remains cautiously optimistic, with traders advised to maintain a buy-on-dips strategy amid strong market momentum.
Overall, the Indian equity market appears to be on an upward trajectory, driven by strong performances in key sectors and renewed foreign investments, despite the challenges posed by external factors and economic uncertainties. As the markets continue to react to both domestic and international cues, investors are keenly watching for further developments that could shape the trading landscape in the coming weeks.
