Mumbai, Jul 15 (PTI) Stock market benchmark indices Sensex and Nifty rebounded in early trade on Tuesday after four days of decline amid retail inflation declining to over six-year low of 2.1 per cent in June, nearing the RBI's comfort zone.

A positive trend at Wall Street in overnight trade also led to domestic equity markets recovery during the initial trade.

The 30-share BSE Sensex climbed 203.95 points to 82,457.41 in early trade. The 50-share NSE Nifty went up by 68.85 points to 25,151.15.

From the Sensex firms, Sun Pharma, Bharti Airtel, Mahindra & Mahindra, Bharat Electronics, Tata Motors and Infosys were among the biggest gainers.

However, HCL Tech declined nearly 3 per cent after the IT services firm reported a 9.7 per cent drop in consolidated net profit for the June quarter, hurt by higher expenses and one-time impact of a client bankruptcy, but raised the lower end of revenue growth outlook for the full fiscal on booking expectations in coming quarters. Eternal, UltraTech Cement, Tata Steel and ICICI Bank were also the laggards. Retail inflation declined to over six-year low of 2.1 per cent in June, nearing the RBI's comfort zone, on account of subdued prices of food items, including vegetables, driven by widespread monsoon.

The Consumer Price Index-based inflation was 2.82 per cent in May and 5.08 per cent in June 2024.

Inflation is on a decline since November 2024. Year-on-year inflation rate based on CPI for the month of June 2025 over June 2024 is 2.1 per cent, the National Statistics Office (NSO) said in a statement on Monday.

"Market is in a state of drift with no clear indications of a sharp change of course. FIIs who have been net buyers in April, May and June have turned net sellers in July as per the latest data. This has put pressure on large caps. A significant macro trend is the decline of CPI inflation in June to 2.10 per cent. It appears that inflation will undershoot RBI's projection of 3.7 per cent CPI inflation for FY26. This has raised rate cut hopes," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.

In Asian markets, Japan's Nikkei 225 index and Hong Kong's Hang Seng were trading in the positive territory while South Korea's Kospi and Shanghai's SSE Composite index quoted lower.

The US markets ended in the positive territory on Monday. Global oil benchmark Brent crude dipped 0.39 per cent to USD 68.94 a barrel.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,614.32 crore on Monday, while Domestic Institutional Investors (DIIs) bought stocks worth Rs 1,787.68 crore, according to exchange data.

On Monday, the BSE Sensex dropped by 247.01 points or 0.30 per cent to settle at 82,253.46. The Nifty settled lower by 67.55 points or 0.27 per cent to 25,082.30. PTI SUM DR DR

Inflation decline spurs rate-cut expectations as equity markets rebound amid shifting FII and DII flows. Retail CPI inflation fell to 2.1 per cent in June, driven by subdued food prices, bringing inflation closer to the central bank's comfort zone and strengthening expectations of monetary easing; this macro shift supported an early equity market rebound, while divergent corporate earnings and a switch in foreign institutional flows to net selling contrasted with domestic institutional buying, producing sectoral volatility.