Sensex jumps 460 points on RBI’s dovish stance
At close, the Sensex was up 460 points or 0.94% at 49,661.76, and the Nifty ended at 14,819 rallying 135 points or 0.92%.
Backed by the accommodative stance adopted by RBI in its first bi-monthly monetary policy of 2021-22 benchmark equity indices rallied on Wednesday. On an intraday basis 30 share index Sensex jumped 700 points and hit the day’s high of 49,900. Whereas the Nifty50 soared nearly 200 points and hit 14,880.
At close, the Sensex was up 460 points or 0.94% at 49,661.76, and the Nifty ended at 14,819 rallying 135 points or 0.92%.
27 of 30 Sensex stocks ended in green with SBI leading the pack up 2.25%, followed by ICICI Bank, Nestle India, IndusInd Bank and M&M surging around 2%. Titan, NTPC & HUL were the losers on the Sensex down in the range of 0.10-0.80%.
On the sectoral front, banking stocks were buzzing with Nifty Bank rallying 1.5%. While Nifty Auto, Nifty IT, Nifty Realty and Nifty Metal soared anywhere between 0.90-1.5%.
In the broader markets, smallcap stocks beat both, mid and largecap peers. The BSE SmallCap index was up 1.3% while the BSE MidCap index added 0.8%.
RBI Policy Outcome:
The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI), announcing its first bi-monthly monetary policy of the 2021-22 fiscal today, voted to leave the policy repo rate unchanged at 4%. MPC maintained an accommodative stance in a unanimous vote.
RBI Governor Shaktikanta Das said that the CPI inflation trajectory likely to be subject to both upside and downside pressures. The central banker further said that the projection for CPI inflation has been revised to 5% in Q4 of the financial year 2020-21, 5% in Q1 FY22, 5.2% in Q2, 4.4% in Q3 and 5.1% in Q4 with risks broadly balanced.
While the RBI maintained its FY22 real GDP growth projection at 10.5%, the RBI Governor said that the recent surge in COVID-19 infections has given greater uncertainty on the growth outlook.
New listing:
Shares of Barbeque-Nation Hospitality were trading at Rs 590.40 at 15:26 IST on the BSE, a premium of 18.08% over the initial public offer (IPO) price of Rs 500.
The stock was listed at Rs 492, a discount of 1.6% to the IPO price. So far, the stock hit a high of Rs 590.40 and low of Rs 481.35. On the BSE, 8.97 lakh shares were traded on the counter so far.
Global markets:
Markets in Europe advanced while Asian stocks ended mostly higher on Wednesday. US stocks fell from record levels on Tuesday as the recent rally driven by signs of strong economic rebound took a pause.
On Tuesday, California Governor Gavin Newsom said that the state will reopen its economy by June 15 provided that coronavirus vaccine and hospitalization cases remain stable.
The IMF on Tuesday projected an impressive 12.5% growth rate for India in 2021, stronger than that of China, the only major economy to have a positive growth rate last year during the COVID-19 pandemic. The Indian economy is expected to grow by 6.9% in 2022.
The IMF revised up its forecast for the world economy. On Tuesday, the organization said it expects growth at 6% in 2021, up from a January prediction of 5.5%, and Chief Economist Gita Gopinath said that despite lingering uncertainties around the pandemic, a way out of this health and economic crisis is increasingly visible.