Sensex Rallies Over 650 Points, Banks Rally After RBI Holds Rates Steady
The Indian equity benchmarks extended gains in noon deals led by gains in rate sensitive banking, auto and financial services shares after the Reserve Bank of India kept repo rate unchanged at 4 per cent and maintained its accommodative stance. The benchmarks opened higher and extended gains after RBI's monetary policy decision. The Sensex rose as much as 699 points and Nifty 50 index climbed above its important psychological level of 14,850.
As of 1:17 pm, the Sensex was up 668 points or 1.36 per cent to 49,867 and Nifty 50 index rose 190 points or 1.29 per cent to 14,873.
Reserve Bank of India Governor Shaktikanta Das-led Monetary Policy Committee kept the key rates unchanged, saying the recent resurgence in Covid-19 infections has created "uncertainty" about recovery in economic growth. The central bank retained the repo rate at 4 per cent and the reverse repo rate at 3.35 per cent.
The governor also maintained its accommodative stance saying the stance will remain accommodative as long as economic recovery is ensured. The RBI also maintained current financial year's GDP growth forecast of 10.5 per cent.
Meanwhile, buying was visible across sectors as all the 11 sector gauges compiled by the National Stock Exchange were trading higher led by the Nifty PSU Bank index's over 2 per cent gain. Nifty Bank, Auto, Financial Services, Pharma and Private bank indexes also rose over 1 per cent each.
Mid- and small-cap shares were also witnessing buying interest as the Nifty Midcap 100 index rose 0.9 per cent and Nifty Smallcap 100 index rose 1.7 per cent.
Shares of casual dining chain operator Barbeque Nation Hospitality bounced back after making a tepid stock market debut. Barbeque Nation Hospitality shares opened for trading at Rs 492 on the BSE and at Rs 489 on the National Stock Exchange against its issue price of Rs 500 per share. However, the shares rebounded soon after opening and rose as much as 18 per cent to hit an intraday high of Rs 590 on the BSE and climbed as much as 17.56 per cent to Rs 587.80 on the National Stock Exchange.
JSW Steel was top Nifty gainer, the stock rose 3 per cent to Rs 554. Power Grid, State Bank of India, Bharti Airtel, Nestle India, Dr Reddy's Labs, Reliance Industries, IndusInd Bank, SBI Life, ICICI Bank, Asian Paints, Kotak Mahindra Bank and Hindalco also rose between 1.75-3 per cent.
On the flipside, Adani Ports, Tata Consumer Products and TCS were among the notable losers.
The overall market breadth was extremely positive as 1,746 shares were advancing while 971 were declining on the BSE.
