Mumbai– Indian stock markets surged on Friday after the Reserve Bank of India (RBI) delivered a powerful stimulus by slashing the repo rate by 50 basis points to 5.50% and reducing the cash reserve ratio (CRR) by 100 basis points, implemented in four phases. The moves triggered a wave of optimism among investors.
The benchmark indices responded strongly to the central bank’s announcements. The BSE Sensex climbed 746.95 points, or 0.92%, to close at 82,188.99, while the NSE Nifty jumped 252.15 points, or 1.02%, finishing at 25,003.05—its first close above the 25,000 mark in several sessions.
Banking stocks led the rally, with the Nifty Bank index surging 817.55 points, or 1.47%, to 56,578.40. During intraday trading, it touched 56,695—its highest level to date.
Midcap and smallcap stocks also gained traction. The Nifty Midcap 100 rose 707.30 points, or 1.21%, to close at 59,010.30, while the Nifty Smallcap 100 gained 149.85 points, or 0.81%, ending at 18,582.45.
Rupak De, Senior Technical Analyst at LKP Securities, described the RBI’s actions as a “bazooka policy move” that ignited fresh momentum in the markets.
“Nifty closing above 25,000 signals a renewed wave of optimism. A rally followed by consolidation often precedes an upward breakout, and we believe Nifty is poised to move beyond its recent range,” De said.
The aggressive rate cut and liquidity infusion through the CRR reduction are expected to accelerate transmission of lower interest rates across the economy. Analysts say the RBI’s bold steps underscore its commitment to spurring economic growth, attracting investment, and boosting consumer spending.
Rate-sensitive sectors—including banking, real estate, automobiles, and consumer durables—led the charge, with experts predicting continued strength in these segments.
Ajit Mishra, SVP of Research at Religare Broking Ltd., noted, “We expect rate-sensitive sectors and themes like railways to remain in focus, while other sectors may show strength on a rotational basis. We maintain a ‘buy on dips’ strategy, emphasizing selective stock picking.”
The RBI’s policy shift is widely seen as a game-changer for market sentiment, setting the stage for sustained bullish momentum in the coming weeks. (Source: IANS)
