HIGHLIGHTS

• India’s CPI inflation eases to 3.16% in April 2025, lowest since July 2019
• Tata Motors March quarter net profit drops 51% to ₹84.70 billion 
• Cipla March quarter net profit jumps 30% to ₹12.22 billion
• Paytm shares fall after over 4% equity changes hands; Antfin likely seller
• Gensol Engineering hit upper circuit after MD Anmol Jaggi, director Puneet Jaggi resign

Indian equity benchmarks witnessed profit booking on May 13, pausing after the record gains seen in the previous session. The Nifty50 slipped below the 24,600 mark, dragged down by selling in IT, FMCG, auto, and banking stocks. The Sensex also ended in the red, reflecting a mild retreat in frontline counters.

However, the broader market displayed notable resilience. The Nifty Midcap 100 rose 105 points to settle at 55,521, supported by sustained investor interest in mid-sized companies. The market breadth remained firmly positive, with a 2:1 advance-decline ratio, indicating continued accumulation outside of the index heavyweights.

Defence stocks stood out, rallying up to 10% after Prime Minister Narendra Modi reaffirmed the government’s commitment to indigenous defence manufacturing under. This sectoral optimism boosted counters like BHARAT ELECTRONICS and other defence-linked firms.

Hero MotoCorp and Cipla advanced 1–2% each, buoyed by encouraging quarterly results and earnings commentary.

Sectoral Performance
Capital goods, media, PSU Bank, and pharma indices led sectoral gainers, climbing between 1% and 1.6%. In contrast, IT, metal, FMCG, oil & gas, and realty sectors faced selling pressure, shedding between 0.9% and 2.5%.

Among Nifty constituents, Power Grid Corp, Infosys, TCS, and HCL Technologies were among the top laggards. On the gaining side, Bharat Electronics, Jio Financial, Hero Motocorp, Dr Reddy’s Labs, and Sun Pharma outperformed.

Top Gainers	% Change	Top Losers	% Change
NIFTY MEDIA	1.66%	NIFTY IT	-2.42%
NIFTY PSU BANK	1.56%	NIFTY FMCG	-1.34%
NIFTY PHARMA	1.22%	NIFTY FINANCIAL SERVICES	-1.10%
NIFTY HEALTHCARE INDEX	0.97%	NIFTY AUTO	-1.00%
		NIFTY PRIVATE BANK	-0.99%

Indian government bond yields fell sharply on Tuesday, buoyed by easing geopolitical tensions and fall in inflation number. The ceasefire agreement between India and Pakistan restored confidence among bond investors, while the latest inflation reading strengthened hopes of an interest rate cut by the Reserve Bank of India.

The yield on the 6.79%, 2034 gilts dropped 5 basis points to close at 6.3289%, compared to its previous finish at 6.3750%. Similarly, the new 10-year benchmark bond – the 6.33%, 2035 bonds – ended at 6.2792%. Both instruments witnessed strong buying interest throughout the session.

Market participants cited expectations that the 6.79% 2034 bond could be included in the RBI’s upcoming open market operation purchase, further supporting demand. The central bank is scheduled to purchase ₹250 billion worth of bonds on Thursday, which is expected to provide additional liquidity and stability in the debt market.

The bond rally was also underpinned by India’s retail inflation, which stayed below the RBI’s medium-term 4% target for the third consecutive month. A slower rise in food prices contributed to the benign inflation print, enhancing the case for monetary easing to support economic growth.

Tenure	Today	Previous
10-year Gilt	6.33%	6.38%
5-year gilt	6.02%	6.08%
5-year OIS	5.65%	5.66%

The Indian rupee closed slightly stronger on Tuesday, trimming early gains as a firmer US dollar limited upside from easing geopolitical tensions. The domestic currency ended at 85.33 per dollar, up 4 paise from Friday’s close of 85.37.

The session began on a strong note, with the rupee opening at 84.67 — its best intraday level since April 30 — supported by relief over a ceasefire agreement between India and Pakistan. The two nuclear-armed neighbours agreed to halt hostilities on Saturday, ending four days of cross-border skirmishes that had raised fears of a wider conflict.

Initial optimism, however, faded as the US dollar gained momentum globally. Despite a recent decline, the dollar index hovered around 101.55, reflecting investor demand for the greenback amid improving global risk sentiment following tariff reductions by the US and China.

Unit	Today	Previous
Dollar/Rupee	85.33	85.37
Dollar Index	101.40	100.17
1-year Dollar/rupee premium (%)	2.19%	2.31%

OUTLOOK
Indian financial markets likely to remain steady in the near term, supported by easing geopolitical tensions and favorable macroeconomic indicators. While profit booking may continue in frontline indices following last week's record gains, broader markets could outperform, supported by strong midcap and defence-related counters. 

In the bond market, yields may trend lower in the coming sessions. The benchmark 10-year government bond yield is expected to remain under pressure, aided by soft inflation data and growing hopes of monetary easing. The Reserve Bank of India’s upcoming ₹250 billion bond purchase on Thursday could add further support to gilt prices. Traders will closely watch for any inclusion of the 2034 bond in RBI’s open market operations, which could enhance demand and compress yields further.

The Indian rupee is likely to stay range-bound, with upside capped by a firm US dollar and downside protected by RBI’s active intervention. The ceasefire will reduce immediate geopolitical risks, though global factors, including US monetary policy and dollar index movements, will guide the currency’s near-term direction. 

Key Events & Data Due Tuesday:

Economic Data

• Germany April CPI data
• India April WPI data
• US weekly crude oil inventories data
• OPEC Monthly Report

Corporate Actions

• Jan-Mar earnings 3i Infotech, ADF Foods, Aditya Birla Real Estate, Ajmera Realty & Infra India, Akzo Nobel India, Allcargo Terminals, Apar Industries, Apollo Tyres, Asahi India Glass, Asian Hotels (East), Balu Forge Industries, BASF India, Berger Paints (I), BLS E-Services, Brigade Enterprises, Capital India Finance, Chemcon Speciality Chemicals, Chemfab Alkalis, Dollar Industries, Dredging Corporation of India, eClerx Services, Edelweiss Financial Services, Eicher Motors, Eros International Media, Excel Industries, Foseco India, Ganesh Benzoplast, Ganesh Housing Corporation, Garware Hi-Tech Films, Graphite India, Hikal, Hindustan Aeronautics, Hitachi Energy India, Indian Hume Pipe Company, International Conveyors, Iris Business Services, Jain Irrigation Systems, JB Chemicals & Pharmaceuticals, Jubilant Foodworks, Kirloskar Brothers, Kirloskar Oil Engines, KPI Green Energy, Lupin, Manaksia Coated Metals & Industries, Muthoot Capital Services, Muthoot Finance, NACL Industries, Nelcast, NIIT Learning Systems, Nilkamal, NRB Bearing, Piramal Pharma, Rama Phosphates, RITES, Rushil Decor, Sanofi India, Sharda Cropchem, SHREE CEMENT, Shree Rama Multi-Tech, Shree Renuka Sugars, Surya Roshni, Tata Power Company, The Karnataka Bank, Tilaknagar Industries, Torrent Power, Transport Corporation of India, Vascon Engineers, V-Guard Industries, Zuari Agro Chemicals, 
• Transport Corp of India to consider fund raising

Policy Events

• German Buba President Nagel Speaks 
• German Buba Balz Speaks 
• US Fed Waller Speaks