Indian Stock Market Report: May 26, 2025 – Nifty Breaches 25,000 as Markets Celebrate Trade Relief
26/05/2025
Markets snap two-day losing streak with a spirited recovery, led by banking stocks and small-cap resilience
The Indian equity markets pulled off what can only be described as a classic comeback story on Thursday, May 29th. Like a seasoned batsman who gets beaten by a couple of deliveries but then settles down to play some beautiful shots, our markets shook off their recent blues to deliver a solid performance.
Contents
- Market Performance: The Numbers Tell the Story
- Banking Sector Steals the Show
- Market Movers: Winners and Losers
- Sectoral Performance: Broad-Based Recovery
- Global Tailwinds Provide Support
- Market Breadth Shows Underlying Strength
- Notable Corporate Developments
- IPO Market Buzzing with Activity
- Technical Outlook: What the Charts Say
- Looking Ahead: June Series Begins
- The Bottom Line
Market Performance: The Numbers Tell the Story
The benchmark indices managed to snap their two-day losing streak, with the Sensex closing at 81,633 points, up 321 points or 0.39%. The Nifty 50 gained 81 points to settle at 24,834, marking a 0.33% increase for the day.
What’s particularly encouraging is how the broader markets performed. The Nifty Midcap 100 outpaced the benchmarks with a 0.55% gain, closing at 57,457 points, while the Smallcap 100 index extended its winning streak to five consecutive sessions with a 0.5% uptick.
| Index | Closing | Change | % Change |
|---|---|---|---|
| Sensex | 81,633 | +321 | +0.39% |
| Nifty 50 | 24,834 | +81 | +0.33% |
| Nifty Midcap 100 | 57,457 | +316 | +0.55% |
| Nifty Smallcap 100 | ~17,868 | – | +0.50% |
Banking Sector Steals the Show
The day’s biggest surprise came from an unexpected quarter – IndusInd Bank emerged as the star performer despite facing regulatory headwinds. The stock surged between 2.47% to 2.68%, closing around ₹825-826 levels.
Here’s where it gets interesting: SEBI had barred the bank’s former CEO Sumant Kathpalia and four other senior officials for alleged insider trading. Yet, the stock rallied! Sometimes the market rewards companies for cleaning house, and investors seemed to appreciate the bank’s assurance that there would be no more setbacks.
The broader banking sector followed suit, with Bank Nifty gaining 0.30% to close at 55,580.60 points, effectively snapping its two-day losing streak.
Market Movers: Winners and Losers
Top Gainers in Nifty 50:
- IndusInd Bank: +2.47% to +2.68%
- Sun Pharma: +1.99%
- Trent: +1.65% to +1.76%
- Adani Ports: +1.74%
- Eternal: +1.77% to +1.79%
Top Losers in Nifty 50:
- HDFC Life: -1.07% to -1.08%
- Tata Consumer: -0.68% to -1.03%
- Bharat Electronics: -0.81% to -0.93%
- Jio Financial: -0.67%
- Bajaj Finance: -0.62%
Sectoral Performance: Broad-Based Recovery
Most sectors managed to shake off their recent weakness. PSU Bank emerged as the top sectoral gainer, led by strong performances from Bank of Baroda and Punjab National Bank. Metal, FMCG, Oil & Gas, and Realty sectors all bounced back after two consecutive days of losses.
However, not all sectors joined the party. Pharma continued its slide for the third consecutive day, suggesting some profit-booking in what has been a strong-performing sector this year.
Global Tailwinds Provide Support
The positive sentiment wasn’t just homegrown. International markets provided a supportive backdrop, with US futures trading higher overnight. The S&P 500 futures were up 0.4%, while Nasdaq futures jumped 1.2%.
The key catalyst was a US court blocking Trump’s proposed tariffs, which was like removing a dark cloud hanging over global trade sentiment. This development helped lift risk appetite across Asian markets.
Brent crude oil prices also supported the mood, trading around $66.10 per barrel, up 1.09% for the day. The USD/INR pair remained relatively stable around 85.40 levels.
Market Breadth Shows Underlying Strength
The broader market participation was encouraging, with 69 out of 100 stocks in the Nifty Midcap index closing higher. It’s like having more than two-thirds of your cricket team scoring runs – that’s a pretty solid team effort.
This broad-based participation suggests that the recovery wasn’t just driven by a few large-cap names but had genuine underlying strength across market segments.
Notable Corporate Developments
Beyond IndusInd Bank’s regulatory drama turning into a buying opportunity, Waaree Energies was another standout performer in the midcap space. The solar equipment manufacturer surged over 8% after securing a massive $176 million order for solar modules from the US market.
This development highlights the growing opportunities in India’s renewable energy sector and the increasing global acceptance of Indian solar technology.
IPO Market Buzzing with Activity
The primary market continues to remain active with several IPOs currently in progress:
Closing Today/Tomorrow:
- Prostarm Info Systems
- Nikita Papers
- Blue Water Logistics
- Astonea Labs (closing May 29)
- Scoda Tubes
- Neptune Petrochemicals
- NR Vandana Textile (closing May 30)
Recent Success Stories:
Unified Data-Tech Solutions made its market debut today, while Borana Weaves recently delivered an 18% listing gain, showing continued investor appetite for new offerings.
The pipeline remains robust with big-ticket IPOs from Tata Capital and LG Electronics India (both sized at ₹15,000 crores each) expected in the coming months.
Technical Outlook: What the Charts Say
From a technical perspective, the Nifty formed what analysts call a Doji-like candlestick pattern – essentially the market’s way of saying “we’re not quite sure which direction to go next.” However, the key support level of 24,700 held firm.
As long as the Nifty maintains above this crucial support, technical analysts believe we could see a march toward the 25,000-25,100 zone. The volatility index (VIX) also cooled down to over one-month lows, suggesting calmer waters ahead.
Looking Ahead: June Series Begins
With the monthly F&O expiry now behind us, traders and investors will get a cleaner read on market sentiment without those derivative-related distortions. The fact that small and midcaps are outperforming while large-caps are just finding their feet suggests there’s still selective risk appetite in the market.
Sometimes the smaller players lead the dance before the big boys join in, and that’s exactly what we’re witnessing now.
The Bottom Line
Thursday’s session felt like the market taking a deep breath after a couple of anxious days. While the gains weren’t spectacular, the underlying resilience was evident. The combination of domestic institutional support, improving global sentiment, and selective corporate developments created a positive cocktail.
As we head into the June series, the key will be sustaining this momentum and building on the foundation laid today. With earnings season behind us and policy uncertainties relatively low, the stage seems set for a potentially interesting month ahead.
The market’s ability to turn regulatory concerns into buying opportunities (as seen with IndusInd Bank) and the continued strength in small and midcaps suggests that investor confidence, while cautious, remains intact.
For investors, the message is clear: stay selective, watch the global cues, and remember that in markets, sometimes the best stories are the comeback ones.
