India’s equity benchmarks posted a strong upside move for the second straight session on Wednesday after the Reserve Bank of India (RBI), as widely expected, kept interest rates steady. at an all-time low and maintain an adaptive stance for as long as necessary to support growth. Sensex rose to 1,069 points and the Nifty 50 hit an intraday high of 17,485, led by gains in major index players like Infosys, ICICI Bank, HDFC Bank, Reliance Industries and Bajaj Finance.
Sensex increased by 1,016 points to 58,650 and the Nifty 50 increased by 293 points to 17,470. In the last two trading sessions, Sensex and Nifty have gained more than 3%.
The RBI kept its key lending rate at a record low on Wednesday, saying growth was a priority as it warned of risks from inflation and a new Omicron variant on the economic recovery.
Even as the Reserve Bank of India maintains its accommodative policy stance, it has outlined a plan to drain excess liquidity in the banking system, raising the possibility of a hike in key borrowing rates early in the year. next.
The central bank’s monetary policy committee has kept the lending or redemption rate at 4%. Borrowing or reverse repo interest rates are also kept at 3.35%.
All 50 economists polled by Reuters expect the repo rate to be flat and do not expect a change before the second half of 2022.
The buying was broad-based as all 15 industry measures compiled by the National Stock Exchange ended higher led by a gain of more than 2.5% in the Nifty PSU Bank index. The indexes of Nifty Bank, Media Auto, Information Technology, Financial Services, Metal, Pharma, Private bank and Realty also increased by 1.5-2.5%.
Small and mid-cap stocks were also interested in buying as the Nifty Midcap 100 index gained 1.6% and the Nifty Smallcap 100 index gained 1.83%.
Bajaj Finance is Nifty’s top gainer, shares up 3.6% to close at Rs 7,360. Maruti Suzuki, Hindalco, State Bank of India, Bajaj Finserv, Asian Paint, ICICI Bank, Tata Motors, Bharti Airtel, Sun Pharma, Infosys and Adani Ports also increased by 2-3.2%.
On the other hand, HDFC Life, Kotak Mahindra Bank, Power Grid, Divi’s Labs and Indian Oil were among the notable losers.
Market breadth was extremely positive with 2,329 shares advancing while 949 shares closed lower on the BSE.
