How Did Indian Markets Recover After Early Losses?
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Synopsis
On June 2, Indian stock markets demonstrated impressive resilience by bouncing back from early losses, closing only slightly lower. Factors such as rising US tariffs and geopolitical tensions played a role, yet select heavyweight stocks and sectoral strengths showed promise. This article analyzes the market's performance and investor sentiment amidst uncertainty.
Key Takeaways
- Indian stock markets showed resilience on June 2.
- The Sensex and Nifty recovered significantly from intra-day lows.
- Investor sentiment was affected by US tariffs and geopolitical tensions.
- Heavyweight stocks helped limit losses.
- Selective sector strength was observed in FMCG, real estate, and financial stocks.
Mumbai, June 2 (NationPress) The Indian stock markets displayed remarkable resilience on Monday as they made a strong comeback from early declines, ultimately closing only slightly lower by day's end.
The Sensex wrapped up the session at 81,374, registering a decrease of 77 points or 0.09 percent. This, however, reflects a significant recovery of 719 points from the day's lowest point of 80,654.
In a similar vein, the Nifty finished at 24,717, down by 34 points or 0.14 percent, having bounced back from its intra-day low of 24,526.
The morning trading session was marked by weak investor sentiment following US President Donald Trump's announcement of increased tariffs on steel imports.
The proposed increase, from 25 percent to 50 percent, is anticipated to take effect on June 4.
Additionally, escalating tensions between Russia and Ukraine, fluctuating foreign investment flows, and apprehension ahead of the Reserve Bank of India’s (RBI) policy decision contributed to the overall market mood.
Despite this shaky start, select heavyweight stocks attracted buying interest, helping to mitigate further losses.
Stocks such as Adani Ports, Mahindra and Mahindra, Zomato (operating as Eternal), PowerGrid, Hindustan Unilever, Bajaj Finserv, ITC, ICICI Bank, Asian Paints, and Nestle India experienced gains ranging from 0.4 percent to 2 percent.
In the broader market, the Nifty MidCap and Nifty SmallCap indices outshone their peers, closing with gains of 0.62 percent and 1.1 percent, respectively.
Among sectors, the Nifty IT and Nifty Metal indices were adversely affected, both declining by 0.7 percent amid concerns over US tariffs.
Conversely, the Nifty Realty and Nifty PSU Bank indices emerged as the top performers, each rising over 2 percent.
“The domestic market has been in a consolidation phase for the third consecutive week, influenced by renewed worries regarding a potential tariff war and rising geopolitical tensions between Russia and Ukraine,” remarked Vinod Nair of Geojit Investments Limited.
“While global uncertainties have prompted investors to adopt a risk-averse approach, the Indian market has shown resilience, supported by strong institutional inflows and selective strength in sectors like FMCG, real estate, and financial stocks,” Nair noted.
He added that under the current market conditions, investors are following a cautious short-term strategy, focusing on domestically-oriented and interest-sensitive sectors.
Point of View
It's important to note that the Indian stock market's ability to recover from early losses reflects its inherent strength. While external factors such as geopolitical tensions and tariffs create uncertainty, the underlying institutional support and sectoral resilience are commendable. We stand by the truth and deliver unbiased insights to keep our readers informed.
NationPress
09/06/2025
Frequently Asked Questions
What caused the early slump in Indian stock markets?
The early slump was primarily triggered by US President Trump's announcement of increased tariffs on steel imports, along with rising geopolitical tensions between Russia and Ukraine.
How did the major indices perform during the day?
The Sensex ended at 81,374, down 77 points, while the Nifty closed at 24,717, down 34 points, both recovering significantly from their intra-day lows.
Which sectors performed well despite the market's decline?
The Nifty Realty and Nifty PSU Bank indices were standout performers, each rising over 2%, while the Nifty IT and Nifty Metal indices faced declines.
What is the current market sentiment among investors?
Investor sentiment remains cautious, with many adopting a risk-averse approach due to global uncertainties, yet there is resilience backed by institutional inflows.
What strategy are investors adopting in the current market?
Investors are focusing on a cautious short-term strategy, particularly in domestically-oriented and interest-sensitive sectors.
