Nomura positive on India equities amidst global market shifts
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Business Standard
an hour ago
- Business Standard
Markets cheer RBI's jumbo rate cut; Sensex ends 746.95 points higher
Benchmark equity indices surged on Friday to post their biggest single-day gains in three weeks after the Reserve Bank of India (RBI) trimmed interest rates by 50 basis points. The 30-share BSE Sensex jumped 746.95 points, or 0.92 per cent, to settle at 82,188.99. The 50-share NSE Nifty reclaimed the 25,000-level and climbed 252.15 points, or 1.02 per cent, to settle at 25,003.05. Interest-rate-sensitive realty index soared 4.74 per cent, while auto index raced 1.50 per cent and bankex climbed 1.25 per cent. Friday's rally added ₹3.6 trillion to the market capitalisation of BSE-listed firms, which now stands at ₹451 trillion. With the latest reduction, the RBI has now cut interest rates by a total of 100 basis points in 2025, starting with a quarter-point reduction in February — the first cut since May 2020. Additionally, the RBI slashed the cash reserve ratio by 100 basis points to 3 per cent, a phased cut effective between September and December. These measures are expected to inject ₹2.5 trillion into the financial system. "Several external headwinds — ranging from US tariff policies and global trade tensions to sluggish worldwide growth and geopolitical risks — have weighed on domestic economic prospects, reinforcing the rationale for monetary easing,' said Dhiraj Relli, managing director and CEO of HDFC Securities. 'With enhanced liquidity and reduced borrowing costs, conditions are now set for sustained economic momentum and a market recovery. This stimulus could propel Indian equity markets beyond their current trading range, potentially pushing the Nifty past 25,000 and toward previous highs of 26,200," Relli added. The market breadth was positive, with 2,194 stocks advancing and 1,832 declining. Barring two, all Sensex stocks gained. HDFC Bank, which rose 1.4 per cent, was the biggest contributor to Sensex gains, followed by Bajaj Finance, which rose by 4.9 per cent. Bajaj Finance was also the best performing stock on the Sensex. "Monsoon-linked sectors such as fertilisers, agrochemicals, rural finance, and two-wheelers will be in focus, backed by forecasts of an above-average monsoon in 2025. We expect Indian markets to witness a gradual upgrade, supported by positive sentiment following an anticipated rate cut by RBI and optimism surrounding a potential US-India trade agreement with officials from both sides meeting in New Delhi this week to finalise the first phase of the proposed deal,' said Siddhartha Khemka, head of research, wealth management, Motilal Oswal Financial Services.
Time of India
an hour ago
- Time of India
Rate-cut boost: Rupee jumps 11 paise to 85.68 against dollar; market rally and CRR cut lift sentiment
The rupee appreciated by 11 paise to close at 85.68 against the US dollar on Friday, reversing early losses after the Reserve Bank of India (RBI) delivered a surprise 50 basis point repo rate cut and announced a phased 100 basis point reduction in the cash reserve ratio (CRR). The local unit opened weak at 85.91, down 12 paise from the previous close of 85.79. But sentiment turned sharply positive after the RBI's unexpected rate action, which supported growth prospects and lifted domestic equities. The rupee touched an intra-day high of 85.66 and a low of 86 before settling higher, PTI reported. "The rupee led the pack among Asian currencies, buoyed by the RBI's surprise 50 basis point rate cut. This decisive, growth-driven policy move provided a significant boost to the local currency and fuelled optimism among domestic equity investors," said Dilip Parmar, Senior Research Analyst at HDFC Securities. At the policy briefing, RBI Governor Sanjay Malhotra said the decision to move to a 'neutral' stance from 'accommodative' reflected a data-dependent outlook going forward. He added that the economy remained resilient, with foreign reserves strong enough to fund 11 months of imports and cover 96% of external debt. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Mistura chinesa faz cabelo crescer e homem fica irreconhecível Resultados em 30 dias Undo The surprise CRR cut is expected to inject additional liquidity into the banking system, lowering borrowing costs and aiding credit transmission. Anurag Mittal, Head of Fixed Income at UTI AMC, called the move "pre-emptive and precise," noting that the central bank's intent to fast-track transmission was clear despite existing surplus liquidity. The RBI retained its GDP growth forecast for FY25 at 6.5%. Despite the rate-induced rally, analysts warned of external risks. A rising dollar index, up 0.25% to 98.98, and weakening Asian currencies could limit further gains for the rupee. Brent crude futures slipped 0.26% to $65.17 per barrel. 'Any further rate cut by the RBI may also pressurise the rupee. However, a positive tone in the domestic markets may support the domestic currency at lower levels,' said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan. He expects the USD-INR pair to trade between 85.40 and 86.25 in the near term. Equity markets reflected the upbeat sentiment. The Sensex closed 747 points higher at 82,189, while the Nifty crossed the 25,000-mark to end at 25,003, up 252 points. Foreign institutional investors were net buyers, purchasing equities worth Rs 1,009.71 crore, exchange data showed. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
The Print
2 hours ago
- The Print
Sensex jumps over 700 points, Nifty reclaims 25,000-level as investors cheer RBI's jumbo rate cut
The policy is broadly positive for growth and investment in a challenging global macro environment, they said. Market analysts said in light of benign inflation forecasts, RBI has taken steps to boost growth. A 50 bps repo rate cut supported by phased 100 basis points CRR cut will boost growth and lower the borrowing costs. Mumbai, Jun 6 (PTI) Benchmark indices Sensex and Nifty surged nearly 1 per cent on Friday, driven by a rally in rate-sensitive sectors following the Reserve Bank's jumbo rate cut of 50 basis points. After a muted start, benchmark sensitive index Sensex and Nifty soon recovered all the early lost ground fuelled by the RBI monetary policy decision and gained over 1 per cent. The 30-share BSE Sensex ended the day higher by 746.95 points, or 0.92 per cent, to settle at 82,188.99. During the day, it surged 857.85 points, or 1.05 per cent, to 82,299.89. The 50-share NSE Nifty reclaimed the 25,000-level and climbed 252.15 points, or 1.02 per cent, to settle at 25,003.05. All key sectors contributed to the rally, with rate-sensitive segments such as realty, financials, and auto emerging as top gainers, closely followed by others. Among sectoral indices, realty jumped 4.74 per cent, financial services (1.79 per cent), metal (1.56 per cent), auto (1.50 per cent), consumer discretionary (1.38 per cent), consumer durables (1.30 per cent) and bankex (1.25 per cent). Industrials and capital goods were the only laggards. Interest-rate-sensitive realty index jumped 4.74 per cent, while auto index went up 1.50 per cent and bankex climbed 1.25 per cent. 'The tone was initially cautious ahead of the outcome of the MPC's monetary policy review, but sentiment turned sharply positive following the surprise announcement of a 50-basis points repo rate cut and a staggered 100 basis points reduction in the CRR. This triggered a strong upward move, followed by a range-bound phase for the remainder of the session,' Ajit Mishra – SVP, Research, Religare Broking said. Mishra further noted that 'going forward, the impact of the rate cut is expected to continue influencing market sentiment. The rate-sensitive pack, along with select themes like railways, are likely to stay in focus, while other sectors may contribute on a rotational basis.' The BSE midcap gauge jumped 0.91 per cent and smallcap index climbed 0.43 per cent. As many as 2,278 stocks advanced while 1,744 declined and 134 remained unchanged on the BSE. According to Dhiraj Relli, MD & CEO, HDFC Securities, several external headwinds — ranging from US tariff policies and global trade tensions to sluggish worldwide growth and geopolitical risks — have weighed on domestic economic prospects, reinforcing the rationale for monetary easing. 'With enhanced liquidity and reduced borrowing costs, conditions are now set for sustained economic momentum and a market recovery. Rate-sensitive sectors responded enthusiastically to the announcement, reflecting renewed investor confidence. This stimulus could propel Indian equity markets beyond their current trading range, potentially pushing the Nifty past 25,000 and toward previous highs of 26,200,' Relli said. On the weekly front, the BSE benchmark surged 737.98 points or 0.90 per cent and Nifty jumped 252.35 points or 1 per cent. Global oil benchmark Brent crude dipped 0.46 per cent to USD 65.04 a barrel. In Asian markets, South Korea's Kospi, Japan's Nikkei 225 index and Shanghai's SSE Composite index settled in the positive territory while Hong Kong's Hang Seng ended lower. European markets were on a mixed note, while the US markets ended lower on Thursday. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 208.47 crore on Thursday, according to exchange data. PTI SUM DRR This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
