Noida, Oct 7 (APAC Media): Indian benchmark equity indices ended lower on Wednesday, with the Sensex falling 429 points and the Nifty slipping below the 22,650 marks, after the Reserve Bank of India raised its policy repo rate by 25 basis points and adopted a calibrated tightening stance.
The BSE Sensex declined 429.11 points, or 0.59%, to settle at 72,638.70, while the NSE Nifty 50 fell 173.05 points, or 0.76%, to close at 22,603.05, according to market data.
The RBI raised the repo rate to 5.50% from 5.25%, its first increase since February 2023, as it sought to contain inflationary pressures amid elevated crude oil prices and a challenging global environment.
RBI Lifts Repo Rate by 25 Bps to 5.5% Amid Inflation Pressure, West Asia Tensions
The central bank, however, raised its FY27 economic growth forecast to 7.1%, while increasing its inflation projection to 5.2%.
The rate-sensitive market reacted negatively to the policy decision, with investors assessing the potential impact of higher borrowing costs on corporate earnings and economic activity.
The Nifty Metal index was among the worst-performing sectoral indices, while automobile, FMCG and other rate-sensitive stocks also faced selling pressure.
Among individual Nifty 50 stocks, Titan Company, Adani Enterprises and Hindalco Industries were among the major laggards. Titan shares came under pressure following concerns over the company’s jewellery business performance during the September quarter.
Kotak Mahindra Bank, BSE and Bharti Airtel were among the notable gainers, providing some support to the broader market.
In the broader market, the Nifty MidCap 100 index declined 0.63%, while the Nifty SmallCap 100 index gained 0.30%, indicating mixed investor participation outside the benchmark indices.
Crude oil prices remained another concern for domestic equities, with Brent crude trading above $100 a barrel. Higher oil prices can increase India’s import bill and add to inflationary pressures.
The Indian rupee also weakened against the US dollar, adding to investor caution.
Analysts said market participants will now track global cues, crude oil prices, currency movements and the upcoming corporate earnings season for further direction.
Technically, the Nifty’s ability to hold the 22,600 level will remain important in the near term. A sustained break below the level could trigger further selling, while a recovery above 22,750 may improve sentiment.
Investors are likely to remain selective, with earnings visibility, balance-sheet strength and lower exposure to rising financing costs expected to remain key factors in stock selection.
–ENDS–
Disclaimer: This article is for informational purposes only and is based on publicly available information. APAC Media is not responsible for investment decisions or losses. Please conduct your own research or consult a financial adviser before investing.
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