Sensex Surges Over 1,000 Points To Reverse Earlier Losses After RBI's Rate Hike

Stock Market India: Sensex reverses earlier losses to surge over 900 points
Stock Market India: Sensex reverses earlier losses to surge over 900 points

Indian equity benchmarks surged sharply, reversing losses from earlier in the session after the Reserve Bank of India hiked its key lending rate by 50 points to a three-year high and assured policy action as required, tempering markets' sour sentiment.

The BSE Sensex index jumped over 1,000 points to trade well above 57,000 level, and the broader NSE Nifty index rose nearly 2 per cent to back above 17,000 points.

Power Grid, Kotak Mahindra Bank, UltraTech Cement, HDFC Bank, Reliance Industries, and State Bank of India were among the gainers in the 30-share Sensex pack.

However, the backwards companies were Asian Paints, Tata Consultancy Services, Tech Mahindra, Wipro, and HCL Technologies.

"The 50 bps rate hike by the RBI in today's meeting was in-line with expectations. The key highlights were the resilience shown by the Indian economy considering the turbulent global environment and concerns emanating from global growth slowdown and hawkish stances of various central banks," Santosh Meena, Head of Research at Swastika Investmart Ltd, told PTI.

Earlier in the session, both benchmarks opened in the red, extending their losing streak to eight days in a row before the RBI hiked rates and reconfirmed its stance of action with a whatever it takes tone.

The fall in domestic bourses was largely down to Asian shares on track to have their worst month since the COVID-19 pandemic began, in the wake of another plunge on Wall Street as fears in the currency and bond markets lingered.

After the S&P 500 plummeted more than 2 per cent to its lowest level since November 2020, shares in Japan, Australia, and South Korea all declined. The longest losing streak since September 2015 was predicted for an MSCI Asia-Pacific Equity Gauge, which would be its sixth straight weekly loss.