Share Market Today: Indices Remain Volatile After RBI MPC Decides To Keep Key Rates Unchanged

On the 30-share Sensex platform, Axis Bank, ITC, Titan, L&T, and SBI emerged gainers. On the down side, Infosys, UltraTech Cement, TCS, Tech M, and Hindustan Unilever stood among the losers

In the broader markets, the indices traded entirely in green. The volatility index, India VIX, touched red and stood at 2.66 per cent. 

Source : ABPLIVE AI

Share Market Today: The two key equity benchmark indices, Sensex and Nifty, on Friday began trading on a flat note amidst concerns regarding the final decision of the RBI MPC meeting. Sharing the decisions of the Monetary Policy Committee panel, RBI governor Shaktikanta Das said that they have decided to maintain the status quo on key rates and keep the repo rate unchanged at 6.50 per cent.

Following the announcement, the indices started to trade slightly higher. As of 11:05 AM, the BSE Sensex traded at 81,836.89, climbing over 70 points, while the NSE Nifty50 inched up by 16 points to touch 24,724.45 in the session.

Stock update

On the 30-share Sensex platform, Axis Bank, ITC, Titan, L&T, and SBI emerged gainers. On the down side, Infosys, UltraTech Cement, TCS, Tech M, and Hindustan Unilever stood among the losers.

Sectoral update

In the broader markets, the indices traded entirely in green. The volatility index, India VIX, touched red and stood at 2.66 per cent. 

Among the sectors, the PSU Bank index dominated in green and rallied 1.32 per cent. Meanwhile, the media and IT indices slipped 0.47 per cent and 0.38 per cent respectively.

In the last trading session on Thursday, the indices ended on a high marking it their fifth consecutive closing session in green. The Sensex settled 1 per cent higher, rallying more than 800 points at 81,765.86, while the Nifty closed trading close to 250 points higher at 24,708.40.

However, as markets progressed, the indices pared their gains and traded almost flat amidst high volatility. As of 11:25 AM, the Sensex slipped almost 28 points, while the Nifty dipped nearly 17 points.

As part of the MPC meeting, the RBI also decided to cut down the cash reserve ratio for lenders to 4 per cent from 4.5 per cent. This will result in releasing Rs 1.16 lakh crore for banks and enhance their lending capacity. The CRR represents the percentage of the bank's overall deposits that it needs to maintain in liquid cash with the central bank.

V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, noted, "Monetary policy has delivered exactly what the economy and markets need in the present context. The governor's emphasis on price stability is appropriate given the elevated level of inflation. The decision to cut the CRR by 50 bps facilitating injection of Rs 1.16 trillion of liquidity into the system will ease the liquidity constraints and more importantly reduce the banks’ cost of funds. From the market perspective, this is an excellent policy response. Banking stocks will remain resilient."