In the barometer index, the S&P BSE Sensex, rose 90.83 points or 0.11% to 83,697.29. The Nifty 50 index added 24.75 points or 0.10% to 25,541.80.

The broader market underperformed the frontline indices. The S&P BSE Mid-Cap index shed 0.07% and the S&P BSE Small-Cap index declined 0.18%. The market breadth was positive.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, declined 2.01% to 12.53.

Among the sectoral indices, the Nifty PSU Bank index (up 0.71%), the Nifty Oil & Gas index (up 0.49%) and the Nifty Metal index (up 0.31%) outperformed the Nifty 50 index.

Meanwhile, the Nifty Media index (down 1.31%), the Nifty FMCG index (down 0.69%) and the Nifty IT index (down 0.30%) underperformed the Nifty 50 index.

Economy:

The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) rose to a 14-month high of 58.4 in June, up from 57.6 in May. The headline figure was above its long-run average of 54.1 and pointed to a substantial improvement in the health of the sector. The manufacturing sector experienced a strong end to the first fiscal quarter, marked by improved trends in output and new orders, alongside a record upturn in employment.

June also saw a quicker upturn in new order inflows. The rate of expansion was the strongest in close to a year. According to panel members, the increase was supported by marketing efforts and a substantial rise in exports.

India’s industrial output growth fell to a nine-month low of 1.2% in May 2025, dragged down by weak performance in the manufacturing, mining, and electricity sectors, data released by the National Statistical Office (NSO) on Monday showed. The factory output, measured by the Index of Industrial Production (IIP), had grown 6.3% in May 2024, while the April 2025 estimate has been revised to 2.6%, slightly down from the earlier 2.7%. According to the data, manufacturing – which forms over three-fourths of the IIP – grew 2.6% in May, down from 5.1% a year ago. Mining output shrank 0.1%, reversing a 6.6% expansion in May last year. Electricity generation saw a sharp contraction of 5.8% compared to a robust 13.7% growth a year ago.

India's gross collection of goods and services tax (GST) hit an all-time high of Rs 22.08 lakh crore in the financial year 2024-25, marking a 9.4% year-on-year (YoY) growth compared to the previous financial year, according to an official statement on Monday, 30 June 2025. On 1 July 2025, India will mark the completion of eight years since the implementation of the GST.

India’s fiscal deficit for the first two months of FY26 stood at Rs 13,163 crore, or just 0.8% of the full-year target of Rs 15.69 lakh crore, according to data released by the Controller General of Accounts on Monday. The year-ago deficit for the same period was significantly higher at Rs 50,600 crore.

Numbers to Track:

The yield on India's 10-year benchmark federal paper slipped 0.19% to 6.304 from the previous close of 6.324.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 85.5510 compared with its close of 85.7600 during the previous trading session.

MCX Gold futures for 5 August 2025 settlement gained 1.27% to Rs 97,297.

The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.31% to 96.48.

The United States 10-year bond yield lost 0.14% to 4.196.

Global Markets:

European stocks declined on Tuesday as annual inflation in the eurozone edged up to 2% in June, according to preliminary data from Eurostat. This marks a slight increase from May, when inflation stood at 1.9%.

Asian shares ended mixed as investors evaluated record highs on Wall Street and the potential global effects of U.S. President Donald Trump's tariff policies. The 90-day tariff reprieve is set to expire next week.

U.S. Treasury Secretary Scott Bessent stated on Monday that "countries are negotiating in good faith." However, he cautioned that tariffs could return to the levels announced on April 2 if talks do not progress due to what he described as "recalcitrant" behavior.

Hong Kong market remained closed for a public holiday. In mainland China, the Caixin Manufacturing PMI rose to 50.4 in June, a significant improvement from May’s reading of 48.3. A PMI reading above 50 indicates expansion. This data follows the official government PMI, which showed a third consecutive monthly contraction in Chinese manufacturing activity for June.

On Wall Street, the S&P 500 gained 0.52% to close at another record high. The NASDAQ Composite rose 0.47%, also reaching a new peak, while the Dow Jones Industrial Average climbed 0.63%.

The gains were supported by news of a trade agreement between the United States and China. The agreement raised optimism that further trade deals could be finalized before the July 9 deadline set by President Trump.

Investor sentiment also received a boost after Canada withdrew its digital services tax on technology companies. The tax was scheduled to take effect within hours but was suspended in an effort to revive trade discussions with the United States. President Trump had previously cited the tax as a barrier to negotiations. Canadian Prime Minister Mark Carney and President Trump are now expected to meet with the goal of finalizing a trade agreement by July 21.