Benchmark indices kicked off Tuesday’s session on a strong note, buoyed by encouraging macroeconomic data. Investors cheered a sharper-than-expected fall in retail inflation, which dropped to a six-year low in April.

At 9:29 am, the BSE Sensex was up 462.27 points at 81,610.49, while the NSE Nifty50 rose 135.35 points to 24,713.70. Both indices extended gains shortly after the opening bell, signalling bullish momentum. Today's strong opening was in line with expectations.

Broader markets were also in the green, as volatility eased considerably. Among top gainers on the Sensex were Tata Steel, Bharti Airtel, Eternal (Zomato), Tech Mahindra and Infosys. On the flip side, Tata Motors, Asian Paints, Nestle India, IndusInd Bank and HUL were trading lower.

The sharp dip in April CPI inflation, down to 3.16%, was the biggest catalyst for the market rally. Investors see the lower inflation print as a sign of macroeconomic strength and a potential trigger for further rate cuts by the Reserve Bank of India.

Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said, “Global markets remain volatile amid shifting policy narratives. The US-China tariff drama has subsided with a new trade deal in sight, and the dollar’s weakening trend seems to have paused."

"US 10-year yields have surged to 4.47%, which could affect foreign fund flows to India. There’s also a possibility of capital shifting to Chinese equities amid improving US-China ties. However, a key positive for India is the steep drop in April inflation to 3.16%. This gives the Monetary Policy Committee room for up to three more rate cuts in this cycle, a boost for the overall market, especially rate-sensitive sectors," he added.

Source: India Today