Stock market benchmark indices Sensex and Nifty rallied on Friday after the Reserve Bank of India (RBI) cut interest rates by 25 basis points in its monetary policy meeting to infuse liquidity and bolster economic growth.
Continuing its gains from the previous session despite a volatile start, the 30-share BSE Sensex advanced 318.71 points to 85,584.03, and the 50-share NSE Nifty climbed 95 points to 26,128.75.
The RBI cut interest rates to 5.25 per cent to further economic growth since a better-than-expected GDP of 8.2 per cent in the second quarter of this fiscal and low retail inflation gave room for another rate cut.
Announcing the fifth bi-monthly monetary policy for the current fiscal, RBI Governor Sanjay Malhotra said the Monetary Policy Committee (MPC) has unanimously decided to cut the short-term lending rate, or repo rate, by 25 basis points to 5.25 per cent, with a neutral stance.
Shrugging off concerns over the rupee’s depreciation, the apex bank said its latest move will make housing, auto and commercial loans cheaper.
Also Read: RBI cuts repo rate by 25 bps
The RBI has also sharply raised its growth projection to 7.3 per cent from 6.8 per cent earlier for the current financial year.
“The MPC decided to vote in favour of growth despite ongoing robust growth in the economy. The unanimous nature of the decision in cutting rates by 25 bps reflects the consensus in the MPC that giving a further boost to growth is a risk worth taking even in the context of a depreciating rupee,” opined VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.
The projection of 7.3 per cent GDP growth for FY26 is optimistic for the market, he added.
From the Sensex firms, Bajaj Finance, Infosys, HCL Tech, Bajaj Finserv, Tata Consultancy Services and HDFC Bank were among the major winners. Rate-sensitive stocks like auto and real estate were trading higher.
However, Hindustan Unilever, Axis Bank, Sun Pharma and Tata Steel were among the laggards.
Foreign Institutional Investors (FIIs) offloaded equities worth ₹1,944.19 crore on Thursday, while Domestic Institutional Investors (DIIs) bought stocks worth ₹3,661.05 crore, according to exchange data.
In Asian markets, South Korea’s Kospi and Shanghai’s SSE Composite index traded in positive territory while Japan’s Nikkei 225 index and Hong Kong’s Hang Seng index quoted lower.
US markets ended on a flat note on Thursday.
Brent crude, the global oil benchmark, dipped 0.16 per cent to USD 63.16 per barrel.
On Thursday, the Sensex edged higher by 158.51 points or 0.19 per cent to settle at 85,265.32. The Nifty climbed 47.75 points or 0.18 per cent to 26,033.75.
Follow us
