Realty and Banking Lead Charge as RBI Rate Cuts Ignite a Broadbased Rally

9 Jun 2025 , 11:32 AM

The markets bounced back strongly last week as RBI cut its key repo rate by a surprising 50bps. This takes the total cut for 2025 to 100bps. The current repo rate is also the lowest in 2 years. On the back of this, interest rate sensitives rallied strongly. Many real estate players were up more than 10%. Midcaps and smallcap stocks witnessed stronger rallies than the large caps.

 

NIFTY 50

＄NIFTY 50 – Strong Rally Fueled By Rate Cuts

date	open	high	low	close
2025-06-02	24669.7	24754.4	24526.2	24716.6
2025-06-03	24786.3	24845.1	24502.2	24542.5
2025-06-04	24560.4	24644.2	24530.4	24620.2
2025-06-05	24691.2	24899.8	24613.1	24750.9
2025-06-06	24748.7	25029.5	24671.4	25003.1

Weekly Performance: 1.0%

The NIFTY 50 index was up strongly last week. Its 1.02% rally was driven by a surprising 50bps repo rate cut from RBI. This drove a broadbased rally as interest sensitives performed well. Eternal was the top performer as it jumped 9.88% on broker upgrades. It was followed by Shriram Finance that surged 7.65%, Dr. Reddy’s Laboratories that was up 5.57%, Mahindra & Mahindra that gained 4.36% and Adani Ports that rose 2.71%. HDFC Life was the biggest loser in the pack, ending down -2.8%, followed by TCS, Tata Steel, SBI Life and Bajaj Finance which fell 1.4% to 2.3%. The market breadth was predominantly positive as 37 of the stocks advanced while 13 fell.

 

NIFTY MIDCAP SELECT

＄NIFTY MIDCAP SELECT – Midcaps outperform Largecaps in a strong week for the markets

date	open	high	low	close
2025-06-02	12693.2	12785.8	12643.0	12771.0
2025-06-03	12834.7	12834.8	12676.0	12688.6
2025-06-04	12733.0	12835.5	12647.7	12822.1
2025-06-05	12878.7	12980.3	12842.2	12951.7
2025-06-06	12999.2	13157.2	12956.5	13146.0

Weekly Performance: 3.4%

Midcaps witnessed a significant rally last week. The NIFTY MIDCAP SELECT was up by 3.41%. Godrej Properties was the top gainer as it rallied 10% on RBI rate cuts. It was closely followed by BSE up 9.69%, SRF up 9.18%, Policybazaar up 8.8% and HDFC AMC up 6.37%. On the other hand, Yes Bank, Marico, BHEL and Hindustan Petroleum were the top losers falling 1% to 3%. The rally was broadbased as evidenced by the advance decline ratio of 17:7.

 

NIFTY IT

＄NIFTY IT – IT Stocks are left behind as focus returns to domestic plays

date	open	high	low	close
2025-06-02	37147.9	37172.6	36770.1	37061.9
2025-06-03	37199.6	37367.4	36740.6	36814.9
2025-06-04	36831.3	37088.5	36762.8	36938.1
2025-06-05	37034.4	37408.2	36886.2	37107.9
2025-06-06	37134.1	37356.3	36910.9	37294.9

Weekly Performance: -0.1%

Last week, NIFTY IT Index performed materially worse than NIFTY 50 Index. While the NIFTY 50 was up 1.02%, NIFTY IT index closed flat. Leading the pack of gainers in the NIFTY IT Index were Oracle Financial Services Software & LTI that gained 2.5% to 3.8%. TCS was the top loser, falling 2.3% and was a major drag on the index. Most of the other stocks witnessed marginal movement of less than 1%. Market breadth was neutral at 5 advances to 5 declines.

 

NIFTY AUTO

date	open	high	low	close
2025-06-02	23274.1	23373.4	23147.2	23327.1
2025-06-03	23399.8	23475.8	23204.9	23268.7
2025-06-04	23264.5	23455.1	23250.0	23332.6
2025-06-05	23461.6	23461.6	23169.7	23306.2
2025-06-06	23343.1	23677.7	23208.1	23661.3

Weekly Performance: 1.4%

It was up 1.44% vs NIFTY’s 1.02%. Among gainers, Bharat Forge emerged as the biggest gainer, up 4.47%, followed by Mahindra & Mahindra, up 4.36%, and Motherson, up 2.85%. On the other hand, 2-wheeler players – TVS Motor and Hero Motors were down ~1%. Advances outnumbered declines 12 to 3.

 

NIFTY BANK

＄NIFTY BANK – A broadbased rally on RBI’s rate cut

date	open	high	low	close
2025-06-02	55598.2	55966.3	55400.6	55903.4
2025-06-03	56104.8	56161.4	55455.8	55599.9
2025-06-04	55650.4	55791.0	55408.4	55676.9
2025-06-05	55806.8	56010.1	55580.4	55760.9
2025-06-06	55699.4	56695.0	55534.8	56578.4

Weekly Performance: 1.5%

The NIFTY BANK Index surged 1.5% and outperformed the NIFTY 50. AU Bank was the top gainer, gaining 8.2%. IDFC First Bank and PNB also witnessed strong rallies of 4-5%. On the other hand, Bank of Baroda and Kotak Mahindra Bank were the top losers, falling 1.35% and 0.06%, respectively. Market breadth was extremely positive with 10 advances to 2 declines.
The rally in banking stocks was fueled by RBI’s surprise rate cut of 50bps. Against expectations of a 25bps cut in repo rates, RBI cut repo rates by 50bps. In addition, it announced a 100bps cut in CRR.

 

NIFTY ENERGY

＄NIFTY ENERGY – Loses steam as only select players gain

date	open	high	low	close
2025-06-02	35931.3	36040.3	35818.6	35933.8
2025-06-03	36036.1	36156.2	35511.8	35549.6
2025-06-04	35650.1	35773.4	35368.9	35734.2
2025-06-05	35835.2	36068.9	35767.2	35824.9
2025-06-06	35885.1	35962.4	35790.6	35924.1

Weekly Performance: 0.1%

NIFTY ENERGY index underperformed the broader markets and was up only 0.1%. SJVN, JSW Energy and Reliance Power were the top performers. Reliance Power has been amongst the best performing stocks in the past 5 years. It continues to rally on its green energy wins. On the other hand, Suzlon Energy, Power India, Inox Wind, NLC India, and Bharat Heavy Electricals were among the top losers with losses of 1.59% to 6.67%. Advances outnumbered declines by a ratio of about 27:13, indicating an extremely positive market breadth.

 

NIFTY FMCG

＄NIFTY FMCG – Snaps back and gains after a 2-week losing streak. Alcohol upgrades offer support

date	open	high	low	close
2025-06-02	55350.1	55827.6	55348.1	55732.6
2025-06-03	55785.7	55983.3	55336.7	55460.8
2025-06-04	55542.9	55678.6	55279.5	55530.6
2025-06-05	55660.3	55854.9	55323.2	55632.4
2025-06-06	55737.9	55842.1	55564.1	55802.7

Weekly Performance: 0.9%

NIFTY FMCG index was up almost inline with the market. It gained 0.94% last week compared with 1.02% rise in the NIFTY 50 index. The rally was led by alcohol players – United Spirits, United Breverages and Radico. The India-UK FTA has been a significant factor impacting India’s alcohol players. Earlier, the worry over cheaper imported liquor had caused pressure in share prices of domestic liquor players. Now, analysts believe that the impact is not uniformly negative on all the players. Some may even benefit from higher sales of their own imported and high-end brands. United Spirits rallied after a brokerage upgrade report citing better margin visibility.

On the other hand, Marico, Godrej Consumer Products, Colgate-Palmolive, Dabur India and Emami were the top losers on the index, falling between 0.15%-2.48%. Advances outnumbered declines by 10 to 5. More importantly, it snapped a two-week losing streak.

 

NIFTY PHARMA

＄NIFTY PHARMA – Rallies inline with NIFTY on stock specific and broader tailwinds

date	open	high	low	close
2025-06-02	21445.5	21465.6	21261.0	21394.1
2025-06-03	21514.6	21514.6	21303.8	21354.2
2025-06-04	21338.7	21461.3	21311.7	21371.7
2025-06-05	21407.3	21694.1	21405.9	21644.2
2025-06-06	21686.8	21707.7	21557.0	21684.4

Weekly Performance: 1.1%

The Nifty Pharma Index also bounced back and was up 1.13% last week. Glenmark, Dr. Reddy’s, Laurus Labs, Abbott India and GlaxoSmithKline were the top gainers in the index with gains between 3.36% and 9.13%. Meanwhile, Mankind Pharma, Alkem Laboratories, IPCA Laboratories, Natco Pharma and Biocon were the top losers with losses between 1.73% to 4.67%. Advances slightly led declines, with 12 to 8, indicating a healthy market breadth.
Despite broader strength, some of the moves were stock specific. For instance, Dr. Reddy rallied on a biosimilar partnership with Alvotech.

 

NIFTY REALTY

＄NIFTY REALTY – Best week in years on expectations of lower interest rates after RBI’s rate cut

date	open	high	low	close
2025-06-02	951.5	972.8	943.0	971.2
2025-06-03	978.6	991.3	971.5	982.9
2025-06-04	988.0	988.5	969.7	976.0
2025-06-05	980.7	1000.2	976.6	993.1
2025-06-06	996.3	1042.6	994.5	1039.6

Weekly Performance: 9.5%

It was the NIFTY REALTY index that benefited the most from RBI’s rate cut. It rallied 5% on Friday and 9% for the week. Top gainers in the index were Sobha, Prestige, Brigade, DLF and Godrej Properties, enjoying gains of 10-17%. Raymond was the only loser, falling by 2.02%. 9/10 real estate stocks closed positively. NIFTY AUTO Index also rallied strongly.