Defence and Realty Lead Indian Market Gains in May 2025
In May 2025, the Indian market saw robust gains across various sectors, with defence and real estate leading the charge. The Nifty Microcap 250 surged 12.10%, while the real estate sector rose 7.17%, extending its strong uptrend.
Indian MarketDefenceReal EstateNiftySectorsReal EstateJun 08, 2025
Defence stocks led sectoral performance in May, rallying 21.8%—the strongest gain among all sectors. According to Motilal Oswal, “The defence sector showed a growth of 21.84% in May 2025 with 30.78% growth over the past year.” The surge reflected continued investor interest in government-led defence indigenisation and robust order visibility.
The real estate sector surged 7.17% in May, extending its strong uptrend. Buying accelerated towards the end of the month and into early June, helped by easing liquidity conditions. On June 6, the segment rose nearly 5% in a single session after the Reserve Bank of India announced rate and CRR cuts.
Metal stocks advanced 7.12% in May, supported by strength in global commodity markets and firm pricing. Despite medium-term volatility, investor appetite returned as select counters attracted value buying.
Energy stocks rose 4.78% during the month. The gains came despite volatility in crude prices and geopolitical developments earlier in the year. The sector has now posted a 19.52% return over the past year, according to brokerage data.
Information technology stocks saw a solid recovery, gaining 4.27% in May. The sector had lagged in recent months, but strong quarterly updates from select large-cap firms helped boost sentiment.
Auto stocks rose 4.56% in May. Firm monthly sales data and a recovery in rural demand underpinned the gains. Over the past year, the sector has gained nearly 13.8%.
The banking index moved up 1.20% in May. Gains were moderate as investors awaited cues on margins and loan growth. However, the outlook turned positive after the RBI’s rate move in early June sparked hopes of renewed credit offtake.
Consumer durables rose 0.70% in May, with select names showing strength on the back of improving rural and semi-urban demand. However, high valuations and patchy volume trends kept upside limited.
FMCG stocks declined 2.06% in May—one of only two sectors that ended in the red. According to Motilal Oswal, “All major sectors showed a positive trend except for FMCG and Utilities, which saw a downtrend of -0.09% and -0.04% respectively.”
Healthcare fell 1.16% in May, underperforming the broader indices. Profit-booking in pharma names and muted earnings commentary weighed on the sector, despite one-year gains of 9.5%.
Frequently Asked Questions
What sectors led the Indian market gains in May 2025?
The defence, real estate, metal, energy, IT, auto, and banking sectors led the Indian market gains in May 2025.
How much did the Nifty Microcap 250 surge in May 2025?
The Nifty Microcap 250 surged 12.10% in May 2025.
What was the performance of the defence sector in May 2025?
The defence sector showed a growth of 21.84% in May 2025, making it the strongest gain among all sectors.
Why did the real estate sector perform well in May 2025?
The real estate sector performed well in May 2025 due to easing liquidity conditions and a surge in buying, especially after the Reserve Bank of India announced rate and CRR cuts.
Which sectors underperformed in May 2025?
The FMCG and healthcare sectors underperformed in May 2025, with FMCG declining 2.06% and healthcare falling 1.16%.
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