Saturday, December 28, 2024 | 02:51 AM ISTEN Hindi

Sensex gains 89 pts, Nifty holds 17,350 as RBI hikes repo rate by 50 bps

CLOSING BELL: While an in-line repo rate hike of 50 basis points gave ammunition to the bulls, bears tried to drag the indices as inflation projections were maintained for fiscal 2022-23 (FY23)

SI Reporter New Delhi

Sensex gains 89 pts, Nifty holds 17,350 as RBI hikes repo rate by 50 bps

CLOSING BELL

Stock market highlights: It was a wild ride for the markets on Friday as a hawkish monetary policy by the Reserve Bank of India (RBI) led to a tug of war between bulls and bears. While an in-line repo rate hike of 50 basis points gave ammunition to the bulls, bears tried to drag the indices as inflation projections were maintained for fiscal 2022-23 (FY23) despite three consecutive rate hikes.

Overall, the S&P BSE Sensex oscillated within a band of 405 points during the day, hitting a high of 58,649, and a low of 58,244. The index ended at 58,388, up 89 points or 0.15 per cent. The Nifty50, on the other hand, closed 16 points, or 0.09 per cent, higher at 17,397 levels.

In the broader market, the BSE MidCap and SmallCap indices added up to 0.2 per cent. Among sectors, the Nifty Auto index fell over 1 per cent, bogged down by Balkrishna Industries (down 7 per cent), and M&M (2 per cent). On the upside, the Nifty IT index gained 0.6 per cent.

Rate sensitive stocks hog limelight

Manappuram Finance soared nearly 10 per cent, clocking its biggest intra-day gain in recent times. Meanwhile, shares of State Bank of India were up 1.5 per cent and were seen inching towards a new historic peak; automobile major Bajaj Auto and realty player DLF were trading with modest gains. READ MORE

Covid-era cuts reversed entirely

The latest rate action takes the total tally of rate hikes since May to 140 basis points. Accounting for the introduction of the SDF at a higher rate than the reverse repo rate in April, effective rate hikes stand at 180 bps so far in 2022. READ MORE

3:59 PM

Expert view: Vinod Nair, Head of Research at Geojit Financial Services.

"Despite the rate hike being on the higher side of the expectations, the market welcomed the RBI's move of 50 basis hike with rising bond yields. Even though metals prices are softening, RBI decided to keep FY23 inflation targets unchanged at 6.7 per cent, which is above the tolerance level. However, given that Q3 and Q4 inflation is anticipated to be between 4.0 percent and 4.1 percent, the market is hopeful for the future."

3:58 PM

Tata Elxsi hits life-time high, gains 3.5%

Tata Elxsi gained 3.5 per cent and hit a record high at Rs 9,425 on the back of strong growth outlook. READ MORE

3:52 PM

Bhagiradha Chemicals hits record high, soars over 11%

Bhagiradha Chemicals ended 11.5 per cent higher and also hit record high in trades on Friday, on healthy outlook. The stock has surged over 70 per cent from its low of Rs 736.30 touched on June 21, 2022.

3:51 PM

Balkrishna Industries falls nearly 7% on earnings dis-appointment

Balkrishna Industries skid 6.8 per cent on disappointing margin performance in Q1. The management commentary suggests Q2FY23 to be weak (QoQ decline) due to sluggish demand prospects in Europe and US. READ MORE

3:49 PM

Karur Vysya Bank extends rally

Karur Vysya Bank extended its rally and hit an over two-year high as investors cheerd the lender strong earnings with improved asset quality for the quarter ended June 2022 (Q1FY23).

3:48 PM

M&M slips 2% on profit-taking post Q1 results

Mahindra & Mahindra slipped 2 per cent on profit-taking after the auto major reported over 7-fold jump in Q1 consolidated net at Rs 2,360.72 crore; Total income grew 48 per cent to Rs 28,412 crore.

3:46 PM

View on Bank Nifty:: Kunal Shah, sr. Technical & Derivative Analyst at LKP Securities

"The Bank Nifty index witnessed sideways consolidation throughout the week and is stuck in a broad range between 37,200-38,200 levels. The index needs to break on either side on a closing basis for trending action in the coming week. The index on the intraday chart is trading in an oversold category and the profit booking scenario cannot be ruled out from the current levels."

3:45 PM

Sectoral Indices: Nifty Bank holds fort; Auto, Metals and PSU Bank slip

3:42 PM

Chart Check:: Rupak De, Senior Technical Analyst at LKP Securities

"Nifty remained range bound before closing flat for the day. On the daily chart, it formed a Doji pattern which suggests indecisiveness. The momentum indicator RSI is in bullish crossover. The trend is likely to remain sideways to negative as long as it remains below 17,500. On the lower end, support exists at 17,200/ 17,000."

3:41 PM

Nifty 50:: Movers & Shakers

3:39 PM

Broader markets also end flat; India VIX declines 1.8%

3:37 PM

Expert take on RBI Policy: 50 bps hike – Global new normal for rate hikes

"The tone of the policy was more hawkish than expected. RBI once again hiked repo rate by 50 bps to 5.4 per cent leaving CRR unchanged. Inflation for FY23 forecasted remains unchanged at 6.7 per cent considering some softening in global food & commodity prices versus the hanging sword of geopolitical risks, transmission of input cost pressures to selling price, etc. RBI retained its GDP forecast at 7.20 per cent for FY23 citing buoyancy in domestic demand cramped by global risks. RBI further firmed its stance of withdrawal of accommodation till liquidity conditions normalise. RBI stated that when warranted it will conduct two way fine tuning operations (VRR/ VRRR) depending on evolving liquidity conditions. Yields shot up by 12-15 bps across the curve as market participants were divided equally between 35/ 50 bps. We expect rate hikes to continue in FY23 with yields in general having further upward bias."

- Gurvinder Singh Wasan, Sr. Fund Manager and Credit Analyst - Fixed Income, JM Financial Asset Management Ltd.

3:37 PM