Sensex hits fresh all-time high, surges 1,619 points; rate-sensitive stocks surge up to 9% post RBI policy decision
The market capitalisation of all listed companies on BSE surged by Rs 7.38 lakh crore to Rs 423.27 lakh crore. Post RBI policy decision, realty indices surged up to 9.5%, with Sunteck Realty, Sobha, Brigade, and Lodha rising between 3% and 9.5%. Nifty Bank stocks such as Bandhan Bank, SBI, Axis Bank, AU Small Finance Bank, and Kotak Bank rose by 1-2%.
Bulls returned to Dalal Street with full force on Friday, as the BSE benchmark Sensex advanced 1,619 points or 2.16% to settle at a record high of 76,693. The broader NSE Nifty gained 469 points or 2.05% ending at 23,290. Both indices successfully erased all losses from June 4.Stocks in rate-sensitive sectors such as banking, finance, auto, and real estate soared as much as 9.5% following the RBI's decision to maintain the interest rate unchanged.
The market capitalisation of all listed companies on BSE surged by Rs 7.38 lakh crore to Rs 423.27 lakh crore.
Following the decision, shares of indices surged up to 9.5%, with Sunteck Realty, Sobha, Brigade, and Lodha rising between 3% and 9.5%.
Meanwhile, Nifty stocks such as Bandhan Bank, SBI, Axis Bank, AU Small Finance Bank, and Kotak Bank rose by 1-2%. Shares of Bajaj Finance, Bajaj Finserv, and PFC also experienced gains of 1-3.6%.
Similarly, Nifty Auto stocks increased up to 5.4%, with M&M, Tata Motors, Balkrishna Industries, Apollo Tyres, and Ashok Leyland seeing gains of 2-5.4%.
The rate-setting panel decided to maintain the at 6.5%, continuing the stance of 'withdrawal of accommodation' due to ongoing concerns regarding food inflation and global uncertainties. Meanwhile, the Monetary Policy Committee (MPC) projected the real GDP growth for FY25 to be 7.2%, up from 7%
"As anticipated, the Reserve Bank of India (RBI) maintained its key policy rates and liquidity stance unchanged during the June 2024 monetary policy review. Several indications from the governor's speech suggest that the RBI is unlikely to commence rate cuts soon. The upward revision in growth, the expectation of a non-linear disinflationary process, and a clear signal that the RBI will not mirror the Federal Reserve's anticipated monetary policy easing, imply that a rate cut in 2024 is improbable," said Sujan Hajra, Chief Economist & Executive Director, Anand Rathi.
"Today's policy is neutral for financial markets in the near term, but the medium-term implications are positive for both the equity and debt markets," Hajra said.
Meanwhile, the RBI left its inflation forecast for this fiscal year unchanged at 4.5%.
"Inflation growth balance is moving favorably. Growth is holding firm. Inflation continues to moderate mainly driven by the core component which reached its lowest level in the current series in April 2024. The deflation in fuel prices is ongoing, food inflation, however, remains elevated," stated RBI Governor Shaktikanta Das.
Furthermore, the RBI has maintained the Standing Deposit Facility (SDF) rate at 6.25%, and the Marginal Standing Facility (MSF) rate and bank rate at 6.75%.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Source: Stocks-Markets-Economic Times
