By Angeeras Securities Research Desk

Indian equity markets sustained their upward momentum for the second consecutive session on Thursday, buoyed by strong gains in the pharmaceutical sector and index heavyweights such as Reliance Industries and ICICI Bank. The rally was underpinned by optimism ahead of the Reserve Bank of India’s key monetary policy decision scheduled for Friday.

The Nifty 50 climbed 130.70 points, or 0.53%, closing at 24,750.90, reclaiming its short-term 20-day moving average. The BSE Sensex advanced 443.79 points, or 0.55%, ending the day at 81,442.04.

🗺️ Global Economic Outlook & Market Drivers

Positive cues from Asian peers supported Indian equities, as global markets responded favourably to a decline in U.S. bond yields and weakness in the U.S. dollar index—conditions that typically enhance the appeal of riskier assets in emerging economies. While geopolitical concerns and trade tensions remain on the radar, investor sentiment was lifted by expectations of further monetary easing and improving domestic growth dynamics.

All eyes are now on the RBI Monetary Policy Committee (MPC) meeting outcome, to be announced at 10 AM on June 6, where a 25-basis-point rate cut is widely anticipated. This would mark the third consecutive reduction, reinforcing the central bank’s commitment to supporting growth while keeping inflation within the mandated corridor.

🔍 Sectoral Snapshot

The Nifty Realty Index led the sectoral rally, gaining 1.75%, fueled by a 5.59% surge in Sobha Ltd. The Nifty Pharma Index advanced 1.28%, supported by encouraging developments in biopharma partnerships and clinical trial data. However, despite strong performances in select areas, only four out of thirteen sectoral indices ended the day in the green, indicating sectoral divergence.

Among stocks making headlines:

Dr. Reddy’s Laboratories rose nearly 3% after announcing a partnership with Alvotech to develop a biosimilar version of cancer drug Keytruda for global markets.

Zydus Lifesciences gained 2.6% following a tie-up with Agenus.

Glenmark Pharmaceuticals surged 4.7% on promising early-stage trial results for a myeloma therapy.

Reliance Industries added 1.3%, posting gains for the second straight session.

Waaree Energies rose 3% on news of a stake sale in Indosolar.

HAL gained 2% after clarifying reports regarding a potential delay in its GE414 engine deal.

📈 Market Breadth & Internals

The broader market maintained its strength, with both mid and small caps outperforming the benchmarks:

Nifty Midcap 100 gained 0.65%

Nifty Smallcap 100 rose 0.96%

Market breadth remained healthy, reflecting strong participation across the broader universe. Out of 2,973 NSE-listed stocks, 1,738 advanced, while 1,144 declined.

A total of 72 stocks touched new 52-week highs, while 21 hit 52-week lows.

126 stocks were locked in their upper circuits, and 43 in lower circuits.

Key contributors to the Nifty 50 included:

ICICI Bank, which added 45.08 points,

Reliance Industries, contributing 17.76 points, and

HDFC Bank, adding 10.03 points.

On the other side, Axis Bank, Bajaj Finance, and Mahindra & Mahindra were the major drags, collectively pulling the index lower by approximately 16 points.

🧭 What’s Fueling This Rally?

Investors remain optimistic as several favorable factors converge:

Growing expectations of a rate cut by the RBI,

Improved inflation and growth projections,

Weakness in U.S. dollar and bond yields, making India relatively attractive,

and Momentum from better-than-expected earnings in sectors like BFSI and Pharma.

There is also speculation around a potential India–U.S. trade agreement, which could bolster investor confidence and reinforce India’s position as a resilient growth economy heading into FY26. Early signs of consumption revival further strengthen the outlook, particularly for domestic-focused sectors.

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