The headline equity benchmarks ended with moderate losses on Friday after RBI Governor Sanjay Malhotra announced the Monetary Policy Committee's decision to keep the repo rate unchanged while maintaining its neutral policy stance. Investor sentiment remained cautious as market participants assessed the inflation outlook and the potential impact of government reforms aimed at attracting long-term foreign capital inflows. The Nifty settled below the 23,400 mark. Metal, IT and oil & gas stocks witnessed selling pressure, while media, healthcare and realty shares attracted buying interest.
As per provisional closing data, the barometer index, the S&P BSE Sensex declined 116.67 points or 0.16% to 74,243.34. The Nifty 50 index fell 49.85 points or 0.21% to 23,366.70.
The broader market outperformed the frontline indices. The BSE 150 MidCap Index slipped 0.10% and the BSE 250 SmallCap Index shed 0.01%.
The market breadth was negative. On the BSE, 2,060 shares rose and 2,136 shares fell. A total of 215 shares were unchanged.
In the commodities market, Brent crude for Aug 2026 settlement shed 3 cents or 0.03% to $95 a barrel.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 95.9375 compared with its close of 95.7450 during the previous trading session.
IPO Update:
The initial public offer (IPO) of Hexagon Nutrition received bids for 2,67,70,203 shares as against 2,16,02,008 shares on offer, according to stock exchange data at 15:15 IST on Friday (05 June 2026). The issue was subscribed 1.24 times.
The issue opened for bidding on 05 June 2026 and it will close on 09 June 2026. The price band of the IPO is fixed between Rs 42 to Rs 45 per share.
The initial public offer (IPO) of CMR Green Technologies received bids for 2,20,49,77,632 shares as against 2,30,43,930 shares on offer, according to stock exchange data at 15:15 IST on Friday (05 June 2026). The issue was subscribed 95.69 times.
The issue opened for bidding on 03 June 2026 and it will close on 05 June 2026. The price band of the IPO is fixed between Rs 182 to 192 per share.
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.
India's economy grew at a higher pace of 7.7% during 2025-26 as compared to 7.1% in 2024-25, according to government data released on Friday. In January-March period of the 2025-26 fiscal year, the gross domestic product (GDP) has been estimated to grow 7.8%, the Ministry of Statistics & Programme Implementation (MoSPI) said.
Buzzing Index:
The Nifty Metal index dropped 1.60% to 13,221.65. The index fell 2.47% in three consecutive trading sessions.
Hindustan Zinc (down 6.14%), National Aluminium Company (down 4.42%), Vedanta (down 3.63%), Steel Authority of India (down 3.42%), Hindalco Industries (down 2.93%), Hindustan Copper (down 2.78%), NMDC (down 1.90%), Tata Steel (down 1.8%), Jindal Steel (down 1.33%) and JSW Steel (down 1.31%) declined.
On the other hand, Adani Enterprises (up 2.54%), APL Apollo Tubes (up 0.79%) and Lloyds Metals & Energy (up 0.17%) edged higher.
Stocks in Spotlight:
Bharat Heavy Electricals shed 0.86%. The company has received a notification of award (NOA) from Meja Urja Nigam (MUNPL) for the 3x800 MW Meja Supercritical Thermal Power Project Stage-II EPC package.
Lupin added 0.71%. The company announced that the United States Food and Drug Administration (USFDA) has approved its ranibizumab, Ranluspec (ranibizumab-hkdz) injection.
Juniper Hotels advanced 2.32% after the company has entered into an agreement with Juniper Hospitality Assets (JHAPL), and its seller shareholders, Arun Kumar Saraf and Varun Saraf, for the proposed transaction. The company will develop a five- Star hotel on land parcel measuring approximately 2.524 acres in Sector 23, Dwarka, New Delhi, having emerged as the successful bidder for the licence rights to the site.
Alembic Pharmaceuticals rose 0.15%. The company announced that it has received final approval from the US Food and Drug Administration (USFDA) for its abbreviated new drug application (ANDA) for Haloperidol Tablets USP in strengths of 1 mg, 2 mg, 5 mg, 10 mg, and 20 mg.
CG Power and Industrial Solutions rose 0.04%. The company announced the commissioning and commencement of commercial production at its extra high-voltage (EHV) switchgear manufacturing facility, S3 Unit-II, in Nashik, Maharashtra.
Bajaj Electricals gained 2.43% after the company announced its entry into cables category under its lighting solutions segment, aiming to capitalize on the growing demand in the cables industry.
Bluspring Enterprises surged 10.82% after it has secured a comprehensive operations and maintenance (O&M) contract from Bharat Aluminium Company (BALCO) for its 1,740 MW power plant.
Nephrocare Health Services rose 2.36% after its wholly owned subsidiary, Nephrocare Health Care Services Philippines Inc., has entered into an Asset Transfer Agreement with Inocentes Dialysis Clinic.
Global Markets:
European markets traded higher on Friday, even as investors assessed renewed uncertainty surrounding geopolitical tensions in the Middle East and signs of moderation in the previously strong artificial intelligence (AI)-driven rally.
Meanwhile, Asian markets slumped as investors booked profits in technology stocks and shifted towards more economically sensitive sectors. South Korea's KOSPI emerged as the worst-performing major index in the region, falling as much as 6% during the session amid a sharp sell-off in semiconductor stocks.
Shares of Samsung Electronics and SK Hynix tumbled more than 8% each in early trade, although both stocks later pared a portion of their losses. The weakness in chipmakers weighed heavily on overall market sentiment across the region.
Overnight in the U.S., the Dow Jones Industrial Average rallied to a fresh all-time high, while the Nasdaq Composite underperformed as investors appeared to rotate out of chip names in favor of non-tech stocks.
The 30-stock Dow jumped 874.86 points, or 1.73%, to close at a record 51,561.93. The Nasdaq lost 0.09% and ended at 26,830.96, while the S&P 500 rose 0.41% to 7,584.31.
The rotation was sparked by a sell-off in Broadcom that led investors to pare exposure to AI-linked stocks. The chipmaker slid more than 12% after its fiscal second-quarter revenue missed estimates. Chip names, which led the latest leg higher in the market's rally to record levels, fell broadly. The VanEck Semiconductor ETF (SMH) lost more than 1%. Arm Holdings shed more than 4%, while Micron Technology fell close to 8%.
Stocks also came under pressure on Middle East worries. Mixed messages have emerged recently out of negotiations to end the war, which has upset global markets and caused oil and gasoline prices to spike.
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