The benchmark stock indices are up strongly this morning as the government continues to ease lockdown restrictions.

Unemployment rate in May hit a high as lockdown restrictions forced businesses to cut their workforce.

Join us as we follow the top business news through the day.

Stocks up over 3% in morning session

Ashish Rukhaiyar reports from Mumbai:

Indian equity benchmarks gained more than 3% during the first half of the trading session on Monday as investor sentiments received a boost as government eased lockdown restrictions with a positive trend in Asian markets acting as a catalyst.

At 12 noon, the Sensex was up 1,044 points or 3.22% to trade at 33,468. The gains were primarily led by financials such as Bajaj Finance, State Bank of India, Axis Bank, and HDFC which featured among the top gainers.

The overall market breadth was quite strong with over 1,700 stocks gaining ground as against only around 425 that declined. The broader Nifty was up 303 points or 3.17% at 9,884.

The India VIX index, however, was also up a little over 2% during the afternoon session. Market participants attributed the gains to the phased lifting of lockdown restrictions that is expected to revive economic activity.

Meanwhile, Asian markets were also trading strong with Hang Seng up over 3% while the benchmarks of Japan, South Korea, Taiwan, Indonesia and China all gaining ground.

Indian manufacturing output falls further in May, rate of job cuts accelerates: PMI

Things have only gotten worse in the country's manufacturing sector in May despite the gradual easing of lockdown restrictions.

PTI reports: "The country’s manufacturing sector activity recorded another sharp deterioration in business conditions during May as new orders placed with producers continued to fall after April’s record contraction, leading firms to cut jobs at the quickest pace on record, a monthly survey said on Monday.

The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers’ Index (PMI) stood at 30.8 in May, up from 27.4 in April, pointing to another substantial decline in the health of the country’s manufacturing sector, albeit one that was slightly softer than recorded in April.

In April, the index had slipped into contraction mode, after remaining in the growth territory for 32 consecutive months. In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.

“The latest PMI data suggested that Indian manufacturing output fell further in May. This result is particularly poignant given the record contraction in April which was driven by widespread business closures,” said Eliot Kerr Economist at IHS Markit.

As per the survey, weaker demand drove output lower following April’s record decline. Consequently, firms cut staff numbers at the quickest pace since data collection began over 15 years ago.

“The further reduction in May highlights the challenges that businesses might face in the recovery from this crisis, with demand remaining subdued while the longevity of the pandemic remains uncertain,” Kerr noted."

Businesses are running out of cash to pay expenses

Rupee jumps 32 paise to 75.30 against US dollar in early trade

The bullish sentiment in domestic equities has helped the rupee appreciate against the US dollar.

PTI reports: "The rupee appreciated 32 paise to 75.30 against the US dollar in opening trade on Monday supported by the government’s reopening plan for the domestic economy.

Forex traders said foreign fund inflows, weak American currency and positive opening of domestic equities also boosted investor confidence.

The rupee opened at 75.32 at the interbank forex market and then gained further ground to touch 75.30, up 32 paise over its last close.

It had settled at 75.62 against the US dollar on Friday.

The government on Saturday said a phased exit would begin on June 1 from the over-two-months-long nationwide lockdown.

Announcing the new guidelines, the home ministry said a complete lockdown would continue till June 30 in areas identified as COVID-19 containment zones across the country, but restrictions would be lifted in a phased manner at other places after the ongoing fourth phase.

Reliance Securities in a report said Asian currencies have more or less started with gains against the US gollar supported by less severe response from US President Donald Trump."

India's May jobless rate at 23.48%

An estimate of the unemployment rate among Indians last month.

Reuters reports: "India's unemployment rate in May rose to 23.48%, marginally lower from 23.52% in April, according to data released by the Centre for Monitoring Indian Economy (CMIE) on Monday, reflecting the impact of coronavirus pandemic.

India has reported 190,535 coronavirus cases, with 5,394 deaths.

India's infrastructure output, contributing nearly 40% in industrial production, contracted 38.1% in April from a year earlier, the worst performance in years, government data showed on Friday.

Why the humble FD is the best choice now

Over the course of the past one month, I received many more queries on debt investments than usual. If you think this happened solely because of the Franklin India debt fund fallout, that isn’t the case.

There were questions on buying gilts, gilt funds, going for Bharat Bond ETFs, buying bank AT1 bonds and why not fixed deposits in Yes Bank! The chief reason for all these questions is actually the low interest rate scenario prevailing in bank deposits and post office small savings scheme.

The search for higher rates has begun! But in the process, it is important not to choose options that are ill-suited to your risk profile.

Indian shares surge over 2% as lockdowns ease further

The Nifty and the Sensex have made a strong start to the week as investors are enthused by the easing of lockdown measures.

Reuters reports: "Financial stocks led Indian shares higher on Monday, as the country geared up to further open its economy after a months-long lockdown to curb the spread of the novel coronavirus.

The NSE Nifty 50 index was up 2.46% at 9,817.45 by 0350 GMT, helped by a broadly stronger mood to Asian markets, while the S&P BSE Sensex gained 2.44% to 33,206.18.

The Nifty 50 rose nearly 6% over the previous week led by a rally in beaten-down banking stocks.

The Nifty bank index rose 3.9%, while the financial index gained 3.6%.

India permitted restaurants, malls and religious buildings to reopen from June 8 but extended lockdowns in high-risk zones until June 30 as a record high number of cases were detected nationwide on Saturday.

The reopen plan comes as data on Friday showed the domestic economy grew at 3.1% in the January-March quarter, its slowest pace in at least eight years.

Meanwhile, MSCI's broadest index of Asia-Pacific shares outside Japan rose 2% as progress on opening up economies helped offset jitters over riots in U.S. cities."