Financials Lead Market Rebound Amid RBI Relief, Geopolitical Tensions Cap Gains

At 12:12 p.m. IST, the Nifty 50 was trading higher by 0.97 per cent at 24,35.8, and the BSE Sensex had moved up by 0.48 per cent to 82,134.95.

Market Update at 12:30 PM: India’s stock market indices saw modest gains on Friday, with support from financial stocks after the Reserve Bank of India relaxed norms related to project financing. However, concerns about the ongoing Middle East crisis limited further upside.

At 12:12 p.m. IST, the Nifty 50 was trading higher by 0.97 per cent at 24,35.8, and the BSE Sensex had moved up by 0.48 per cent to 82,134.95.

Twelve out of thirteen major sectoral indices were in the green. Financial stocks gained 0.5 per cent, with public sector banks advancing by 0.8 per cent. Power sector lenders like Power Finance Corporation and REC Ltd rose nearly 3 per cent each, reacting positively to the RBI’s decision to ease infrastructure lending guidelines starting October 2025. The revised rules reduce the provisioning requirements for both under-construction and operational projects, which could lower borrowing costs for banks. Citi Research noted that the RBI’s approach appears more lenient and favorable for lenders.

Mid-Cap and Small-Cap stocks also added around 1 per cent each.

Tensions flared further as Israel reportedly targeted Iranian nuclear facilities, prompting retaliatory missile and drone attacks from Iran. Market sentiment was also affected by the possibility of U.S. military involvement, with President Trump expected to decide on support for Israel within two weeks.

In company-specific developments, Sun TV dropped 4 per cent following reports of a legal notice from Dayanidhi Maran to his brother and Sun TV Chairman, Kalanithi Maran, over alleged ownership-related irregularities. Meanwhile, Trent and Bharat Electronics rose 1 per cent each after being included in the Sensex, whereas IndusInd Bank dipped 0.1 per cent following its exclusion from the index.

Market Update at 10:30 AM: India’s equity indices opened slightly higher on Friday, supported by financial stocks following the Reserve Bank of India’s move to relax project financing guidelines. However, gains remained limited due to rising geopolitical tensions between Israel and Iran.

By 9:23 a.m. IST, the Nifty 50 had edged up 0.17 per cent to 24,836.15, while the BSE Sensex increased by 0.22 per cent to reach 81,540.81.

Out of the 13 key sectoral indices, nine were trading in positive territory. The financial index rose 0.4 per cent, while public sector banks saw a stronger start with a 1 per cent gain.

Power-focused financial companies such as Power Finance Corporation (PFC) and REC Ltd surged 4 per cent each, buoyed by the RBI's regulatory changes that are expected to ease lending for infrastructure projects.

Meanwhile, broader markets were mixed—small-cap stocks declined by 0.3 per cent, and mid-cap shares hovered near flat.

Globally, investor sentiment was cautious amid reports of Israeli airstrikes on Iranian nuclear facilities, prompting retaliatory attacks from Iran involving missiles and drones. The White House indicated that President Trump would decide within two weeks on potential U.S. military support for Israel.

Pre-Market Update at 8:00 AM: Indian markets are expected to begin Friday’s session on a subdued note, influenced by mixed signals from global peers and escalating tensions in the Middle East. Although overall sentiment remains cautious, selective stock movements may continue as a key theme.

As of 7:18 AM, GIFT Nifty hovered around 24,793, indicating a marginal uptick of 6 points from the previous session, suggesting a lackluster opening for Nifty 50 and Sensex. While most Asian indices were trading mixd, U.S. stock futures edged down as uncertainty loomed over the Israel-Iran conflict. Wall Street was closed for the Juneteenth holiday.

Foreign and domestic institutional investors have continued to support Indian equities. On June 19, FIIs recorded net purchases worth Rs 934.62 crore, while DIIs added shares worth Rs 605.97 crore. Notably, DIIs have remained net buyers for 23 straight trading sessions, signaling consistent domestic support.

Geopolitical tensions have escalated with Israel launching strikes on Iranian nuclear facilities. Iran retaliated with drone and missile attacks, including one that reportedly hit a hospital in Israel. The White House has stated that President Trump may announce a decision regarding U.S. involvement within the next two weeks.

Indian indices closed slightly lower on Thursday. The Nifty 50 ended just under 24,800 after slipping 18.80 points (0.08 per cent), while the Sensex fell 82.79 points (0.10 per cent) to finish at 81,361.87.

Asian markets traded in a narrow range on Friday as investors reacted to the U.S. Federal Reserve’s decision to maintain status quo on interest rates. In China, the central bank held both its one-year and five-year LPR steady at 3.0 per cent and 3.5 per cent, respectively. Japan reported core inflation rising to 3.7 per cent in May, signaling sustained price pressures.

Crude oil prices dipped slightly, though they remain on track for a third weekly gain due to geopolitical risks. Brent crude settled at USD 77.36 per barrel, down 1.89 per cent for the session but up 3.9 per cent for the week. WTI crude saw mixed movement, with the July contract at USD 76.00 and August futures climbing to USD 74.00.

Gold prices held firm amid elevated geopolitical uncertainty. Spot gold traded near USD 3,367.60 per ounce, mostly unchanged, despite a weekly decline of nearly 1.9 per cent.

For today, Aditya Birla Fashion and Retail, Biocon, Central Depository Services, Housing and Urban Development Corp, Manappuram Finance and Titagarh Rail Systems continue to remain under the F&O ban list.

Disclaimer: The article is for informational purposes only and not investment advice.