Sensex tanks over 450 points after RBI policy outcome, Nifty tests 19,500; CMS Info, Valiant Organics down up to 8%

Indian equity benchmarks fell sharply in Thursday's trade after the Reserve Bank of India (RBI) kept held its key rates steady for the third consecutive time in its monetary policy decision. The 30-share BSE Sensex slipped 457 points or 0.69 per cent to trade at 65,539, while the broader NSE Nifty was down 132 points or 0.67 per cent to trade at 19,501. Mid- and small-cap shares were down as Nifty Midcap 100 fell 0.11 per cent and small-cap shed 0.20 per cent.

"Indian equity markets have seen a tremendous momentum in the last couple of months. The repo rate decision is likely to maintain this positivity among investors as well. While the fight against inflation is not over yet, the RBI has ensured control," said Adhil Shetty, CEO, Bankbazaar.com.

The Reserve Bank kept the repo rate unchanged at 6.50 per cent. Although, it has raised rates by 250 basis points (bps) since May 2022 in a bid to cool surging prices.

The RBI maintained its policy stance of "withdrawal of accommodation" to ensure inflation progressively aligns with the committee's target while remaining supportive of economic growth, RBI Governor Shaktikanta Das said.

"The indices have reacted to the inflation projection by the RBI and witnessed some profit booking. The sectors like IT, cement, realty, infra and power will be benefitted from today's policy outcome," said market expert Ravi Singh.

On the global front, Asian stock markets edged lower, following a slide in Wall Street equities overnight.

Back home, foreign institutional investors (FIIs) snapped an eight-session selling streak in Indian equities during the previous session. FIIs bought Rs 644 crore worth of shares on a net basis, while domestic institutional investors (DIIs) sold shares worth Rs 598 crore, according to provisional data from the National Stock Exchange (NSE).

14 out of the 15 sector gauges -- compiled by the National Stock Exchange -- were trading in the red. Sub-indexes Nifty Bank, Nifty Financial Services, Nifty FMCG and Nifty Consumer Durables were underperforming the NSE platform by falling as much as 0.68 per cent, 0.72 per cent, 0.68 per cent and 0.69 per cent, respectively.

On the stock-specific front, Asian Paints was the top loser in the Nifty pack as the stock cracked 2.43 per cent to trade at Rs 3,250. Tata Motors, Nestle India, Tata Consumer Products and ICICI Bank fell up to 1.34 per cent.

In contrast, Adani Enterprises, BPCL, Adani Ports, LTI Mindtree and Wipro were among the top gainers.

The overall market breadth was slightly positive as 1,693 shares were advancing while 1,559 were declining on BSE.

On the 30-share BSE index, HDFC Bank, ICICI Bank, ITC, Reliance Industries, Tata Consultancy Services (TCS) and L&T were among the top laggards.

Also, CMS Info Systems, Valiant Organics, RattanIndia Enterprises, Shivalik Bimetal, Granules India and Reliance Power tanked up to 8.22 per cent. On the other hand, Varroc Engineering, Max Financial Services, ITD Cementation India and Ion Exchange jumped up to 15.14 per cent.

Nifty outlook

"The 19,500 regions helped the bulls regroup yesterday on anticipated lines, but the upswing thereof failed to muster enough momentum to clear 19,670, identified as an important challenge when we first spotted the relief rally. Expect opening moves to mirror that of yesterday, with downward bias dominating. Recovery attempts are likely to kick in, once below 19,560, but slippage past 19,530 will limit the upside prospects. Deeper supports are now seen at 19,450/415/380 and further at 19,280 and 18,900," said Anand James, Chief Market Strategist at Geojit Financial Services.
 

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