The stock market closed in the red after Reserve Bank of India (RBI) governor Sanjay Malhotra announced the Monetary Policy Committee (MPC) decision to cut the benchmark repo rate by 25 basis points (bps).
The benchmark BSE Sensex closed 197.97 points or 0.25% in the red, reaching 77,860.19. The broader NSE Nifty was down by 43.40 points or 0.18% in the red, closing at 23,559.95.
Right after the announcement at 10:35 am IST, the Sensex was down 192.14 points or 0.25%, reaching 77,866.02, while the Nifty was down 73.05 points or 0.31%, reaching 23,530.30.
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Which stocks fell the most?
Among the 30 Sensex stocks, ITC Ltd fell the most by 2.38%, closing at ₹430.90. This was followed by SBI, which fell 2.03%, closing at ₹737.05, and Adani Ports & Special Economic Zone Ltd, which fell 1.44%, closing at ₹1,147.15.
14 out of the 30 Sensex stocks were in the red.
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How did individual sectors perform?
Among the Nifty sectoral indices, the Nifty PSU Bank Index fell the most by 1.38%, reaching 6,196.75, followed by Nifty FMCG, which fell 1.30%, reaching 55,113.30, and Nifty Media which was down 1.01%, closing at 1,621.75.
The 10-year India Government bond was down to ₹100.62. This was a drop of 0.22% or ₹0.22.
“Bond market rates appear to have bottomed out, potentially remaining steady or experiencing a slight uptick,” said Suresh Darak, Founder of Bondbazaar.
“However, in the currency market, the rupee still needs to discover its true level amidst the strengthening dollar globally against all major currencies including India,” Darak added.
The rupee meanwhile reached 87.4275 to the dollar. This is a rise of ₹0.16 or 0.18%.
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How did the stock market open?
The stock market went into the red at opening.
At 9:20 am IST, the benchmark BSE Sensex was down by 79.83 points or 0.10%, reaching 77,978.33. The broader NSE Nifty opened 19.50 points down or 0.08% in the red, reaching 23,583.85.
Among the 30 Sensex stocks, Power Grid Corporation of India Ltd fell the most by 2.76%, trading at ₹273.50. This was followed by ITC Ltd, which fell 1.11%, trading at ₹436.50, and SBI, which fell 1.00%, trading at ₹744.80.
Only 11 out of the 30 Sensex stocks were in the green.
Among the Nifty sectoral indices, the Nifty Media index fell the most by 0.94%, reaching 1,622.90, followed by the Nifty Oil & Gas Index, which fell 0.85%, reaching 10,504.10, and Nifty FMCG, which fell 0.73%, reaching 55,434.80. The Nifty FMCG Index had seen falls on opening from at least Tuesday.
What did RBI Governor Sanjay Malhotra announce?
RBI governor Sanjay Malhotra announced that the repo rate would be cut from the prevailing 6.5% by 25 bps to 6.25%.
This was the first rate cut in nearly five years after it remained unchanged for 11 consecutive policy meetings.
Malhotra also announced that the RBI estimates real GDP growth for the next year to be at 6.75%. For the first quarter, it is estimated to be 6.7%, for the second quarter, the estimate is 7%, and it is 6.5% for both the third quarter and fourth quarter.
He also announced other measures such as deferring the digital payments buffer mandate for banks by about a year and also providing an additional authentication facility for international transactions to improve online payment security.
