Nifty 500 climbs 3.5% in May, driven by Industrials, Consumer, and Financial Services: Motilal Oswal

The Nifty 500 index climbed 3.50 per cent in May, driven by steady gains in Industrials, Consumer Discretionary, and Financial Services sectors, an analysis by the Motilal Oswal observed. Sectoral indices of FMCG (Fast-Moving Consumer Goods) and utilities underperformed, posting slight declines of -0.09 per cent and -0.04 per cent, respectively, as per the analysis.

As per the observation, broader market sentiment remained positive, with the Nifty 50 up 1.71 per cent and the Nifty Midcap 150 surging 6.30 per cent. Smallcap and Microcap indices also registered sharp gains.

Among factor-based indices, Momentum and Quality continued to deliver consistent returns, while Enhanced Value and Low Volatility posted moderate advances.

Government bond indices reflected stability, with modest gains in both 5-year and 10-year G-Sec benchmarks.

As per the market experts and several reports available in the public domain, the latest decision of the Reserve Bank of India (RBI) to slash the policy interest rate by 50 basis points will significantly benefit sectors such as banking, NBFCs, real estate, and automobiles.

The RBI’s Monetary Policy Committee on Friday cut the repo rate by 50 basis points to 5.50 per cent (from 6.00 per cent).

This larger-than-expected cut marks the third consecutive reduction in 2025, totalling 100 bps of easing since February.

At the end of the trading on Friday, sectors such as banking and realty saw a major upswing soon after the repo rate revision.

“This big rate cut will impact the margins of the banks and, therefore, bank stocks will be under pressure in the near term. However, the credit growth that this rate cut will hopefully stimulate will compensate for the dip in margins,” said VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited observing the possible impact of the RBI decision.

Except for Media, which was one per cent down on Friday, all other sectoral indices ended higher with metal, auto, and consumer durables jumping over one per cent each.