Equities Surge on Earnings Boost; Rupee Jumps on Strong Inflows 

HIGHLIGHTS

• Govt sets up interministerial committee to frame National Manufacturing Mission
• Govt may allow up to 26% Chinese equity in certain Indian electronic components JVs
• Defence stocks surge on India-Pakistan tensions, Rafale deal
• UltraTech stock falls after company warns of sectoral challenges
• V2 Retail shares hit 5% lower circuit after CEO Manshu Tandon resigns
• RIL adds ₹ 1 trillion to investor wealth as stock rallies 6% post earnings

Indian equities staged a strong rebound on Monday, recovering from Friday’s losses, driven by robust corporate earnings and heavy buying in index heavyweights like Reliance Industries. Investor sentiment turned positive even as global cues remained mixed ahead of the US Federal Reserve's upcoming policy meeting.

Reliance Industries led the charge, surging over 5% after delivering better-than-expected fourth-quarter results, contributing nearly 40% to the Nifty’s overall gains. Its performance provided crucial support to broader market sentiment.

SECTORAL PERFORMANCE 
Banking and midcap stocks witnessed significant buying interest. The Nifty Bank index advanced 769 points to close at 55,433, buoyed by strong earnings from key lenders. Meanwhile, the Nifty Midcap 100 index rose sharply by 870 points to end at 54,440, reflecting sustained investor appetite for mid-tier companies.

Among individual stocks, RBL Bank soared 10% after reporting a solid March quarter performance, with management offering an optimistic outlook on credit growth and asset quality. TVS Motor Company also gained over 2%, following strong quarterly results and a notable improvement in margins.

In the defence sector, Hindustan Aeronautics Ltd climbed 5%, and Bharat Electronics Ltd added 3%, as expectations of increased defence spending amid rising geopolitical tensions boosted investor interest

Top Gainers	% Change	Top Losers	% Change
NIFTY OIL & GAS	3.2%	NIFTY IT	-0.2%
NIFTY PSU BANK	2.4%
NIFTY HEALTHCARE INDEX	2.1%
NIFTY PHARMA	2.0%
NIFTY AUTO	1.6%

Yields on Indian government bonds rose on Monday, as traders sold existing holdings in anticipation of the new benchmark 10-year bond issuance. The selling pressure was exacerbated by unwinding of stretched long positions ahead of the expected supply.

The benchmark 10-year gilt yield rose to 6.3959%, compared with its previous close of 6.3645%. Market participants preferred to lighten positions in the current 10-year security, preparing for a fresh benchmark issue that is expected to draw strong investor interest.

Throughout the session, traders operated on the assumption that the Reserve Bank of India would soon announce the new 10-year bond. This expectation led to cautious sentiment and position adjustments across the curve. Post-market hours, the RBI formally confirmed the plan to issue the new paper.

Tenure	Today	Previous
10-year Gilt	6.40%	6.36%
5-year gilt	6.14%	6.14%
5-year OIS	5.69%	5.67%

The Indian rupee strengthened sharply on Monday, appreciating by 42 paise to close at 85.03 against the US dollar, buoyed by sustained foreign fund inflows, softer crude oil prices, and a strong rally in domestic equities.

At the interbank foreign exchange market, the rupee opened at 85.29 and moved within a broad range, touching an intra-day high of 84.96 and a low of 85.42. It ultimately ended at 85.03, marking a notable recovery from Friday’s close of 85.45.

Additionally, easing crude oil prices provided relief on the current account front, further supporting the rupee’s strength. The combination of a bullish stock market and improved macroeconomic indicators added to the positive sentiment around the domestic currency.

Unit	Today	Previous
Dollar/Rupee	85.03	85.45
Dollar Index	99.28	99.51
1-year Dollar/rupee premium (%)	2.29%	2.25%

OUTLOOK
Equities are likely to open on a positive note on Tuesday, building on Monday’s strong rebound led by corporate earnings optimism and Reliance Industries' robust performance. However, global market trends and geopolitical developments will remain key risk factors that could influence intraday sentiment.

In the bond market, yields are likely to ease on Tuesday after the Reserve Bank of India announced ₹1.25 trillion worth of Open Market Operations for May and scheduled the auction of a new 10-year benchmark bond. 

The Indian rupee is expected to maintain a firm tone, supported by strong foreign fund inflows, rising forex reserves, and relatively softer crude oil prices. However, the RBI’s liquidity operations and global dollar movements will be important factors to watch. Any escalation in geopolitical tensions or stronger-than-expected dollar strength could cap rupee gains despite domestic tailwinds.

Key Events & Data Due Tuesday:

Economic Data

• US March trade data
• US April Consumer Board Consumer Confidence index
• US March Job Openings data

Corporate Actions

• Jan-Mar Earnings:  Bajaj Finance,  Bajaj Finserv,  Trent,  Ambuja Cements,  Bharat Petroleum Corporation, Indian Railway Finance Corporation, Capital Small Finance Bank, CEAT, CIE Automotive India, Davangere Sugar Company, DB (International) Stock Brokers, De Nora India, DELPHI WORLD MONEY, Fedbank Financial Services, Five-Star Business Finance, Indiamart Intermesh, IndoStar Capital Finance, Jana Small Finance Bank, Nath Bio-Genes (India), NDL Ventures, Orbit Exports, PCBL Chemical, Praj Industries, Punjab & Sind Bank,  Schaeffler India, Shoppers Stop, Star Health and Allied Insurance Company, Tamil Nadu Newsprint & Papers, UMIYA BUILDCON, UTI Asset Management Company, Vishal Mega Mart, 
• NTPC Green Energy to consider fund raising
• Bajaj Finance to consider stock split and bonus share