Among sectoral indices, the Nifty Bank index ended 1 per cent down, followed by the Nifty Private Bank, Nifty Financial Services, and FMCG indicesShare Market News Today | Sensex, Nifty, Share Prices HIGHLIGHTS: Domestic equity market benchmarks BSE Sensex and Nifty 50 settled in red on Friday after the Reserve Bank of India (RBI) kept the repo rate unchanged for the sixth consecutive time at 4 per cent and maintained accommodative policy stance. BSE Sensex ended 132 points or 0.25 per cent down at 52,100, while the Nifty 50 index ended 20 points down at 15,670. Top index gainers were Bajaj Finserv, ONGC, Larsen & Toubro (L&T), Bajaj Finance, Housing Development Finance Corporation (HDFC), Ultratech Cement, Bharti Airtel among others. On the flip side, Nestle India, State Bank of India (SBI), ICICI Bank, HDFC Bank, Axis Bank, Reliance Industries Ltd (RIL) were among top Sensex laggards. Among sectoral indices, the Nifty Bank index ended 1 per cent down, followed by the Nifty Private Bank, Nifty Financial Services, and FMCG indices. On the upside, the Nifty Metal index jumped 1.35 per cent and Nifty Realty index was up half a per cent.
Highlights
BSE Sensex ended 132 points or 0.25 per cent down at 52,100, while the Nifty 50 index ended 20 points down at 15,670
Nifty 50 index surged over 6 per cent in May, posting a record closing high. The gains in the 50-stock index were fuelled by strong FII inflows in the second half of the month and steady decline in daily COVID-19 cases in India and strength in other Asian stock markets.
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The MPC’s decision to keep rates and policy stance unchanged remains on expected lines. The MPC has continued to reiterate its decision to prioritise growth as long as necessary as the risks to inflation remain balanced. The MPC statement has adequately discussed the risks to inflation thereby marginally revising up the inflation readings to 5.1% in FY2022 compared to 5% in the previous meeting. Meanwhile, on expected lines the MPC has revised down the GDP growth by 100bps to 9.5%. Adequately so, the RBI continues to focus on providing liquidity to the stressed sectors rather than focussing on a blanket liquidity tools.
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After the initial positivity in the market, the Nifty 50 index could not hold the higher levels and is now trying to hold the support near the level of 15650. If the market is unable to sustain the level of 15650, we will see a small correction in the market to the levels of 15500. On the sectoral front, there is no clear direction. ONGC and Coal India are the top gainers while Nestleind and Hindalco are the top losers on Nifty. Gaurav Garg, Head of Research, CapitalVia Global Research
RBI kept the repo rate unchanged. Though this is not a negative thing, but the markets were mildly expecting a rate cut. Also there was nothing specific in the guidance as well. The markets are just consolidating at current levels; they are mildly overbought and some minor corrective moves cannot be ruled out. For the immediate near term, the 15700-15750 zone is stiff resistance for the coming week. Supports are in the 15400-15500 zone. Any violation of this range on either side will see accelerated moves in that direction. Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst and founder, Gemstone Equity Research & Advisory Services
With WPI inflation above 10% & inching higher every month, it wasn't surprising that RBI has kept rates unchanged with an accommodative stance. Technically, Nifty had also entered the overbought zone with immediate strong support at 15600. Close below 15600 should lead to a correction till 15450-15285. 15750-800 will act as a strong resistance. Nifty Bank looks weak & a close below the immediate support of 35000 could lead to a correction till 34160 in the near term. AR Ramachandran, Co-founder & Trainer, Tips2Trades
Sensex extended losses, fell over 250 points or 0.48 per cent to day's low of 51,953. While the Nifty 50 index gave up 15,650 levels and was trading at 15,622
The Monetary Policy Committee (MPC) of RBI, in its second bi-monthly Monetary Policy Review of 2021-22, has taken cognizance of the need for hastened pace of the vaccination drive and quick ramping up of healthcare infrastructure across both urban and rural areas. This is certainly the need of the hour. Considering the upheaval that the pandemic has caused in the lives of people, policy support from all sides – fiscal, monetary and sectoral – is required to nurture recovery and expedite return to normalcy. The decision to retain the prevailing repo rate at 4 per cent and continue with the accommodative stance as long as necessary to revive and sustain growth on a durable basis highlights a pragmatic approach. Ashvini Danigond, Executive Director and CEO, Manorama Infosolutions Pvt Ltd
Exactly a year ago, RBI had cut the repo rate down to 4% from 5.15%, pre-pandemic levels and the rates have remained unchanged till now. India’s accommodative stance continues to remain inline with global peers such as Fed and ECB and this times policy was also aligned with market expectations. The spectrum of forecasts both in terms of GDP and inflation were balanced out and remained more or less on the optimistic side. The RBI has indeed given a helping hand, in whatever way possible to boost liquidity for MSMEs, the hardest hit space in this pandemic. Support to the contact intensive sectors is definitely a move in the right direction although the relief package could have been higher to hold the bottom of the pyramid from losing ground. Various other decisions in terms of opening the debt markets to FPIs and facilitating a Rs. 1.2 Lakh Cr in Q2FY22 for GSAP2.0 will aid to safeguard our economy from contraction and keep markets buoyant. Jimeet Modi, Founder & CEO, Samco Group
Overall, while we do not see any action on the policy rate front in the coming months, we are poised to see a more accountable and action oriented RBI ahead. We reckon even as yields may inch up gradually and orderly, the RBI will continue to strive fixing skewed yield and maintain its preference for curve flattening (with GSAPs and OMOs). We see net OMO + GSAP purchases to the tune of Rs4.5-5tn in FY22. Madhavi Arora, Lead Economist, Emkay Global Financial Services
The focus in today’s monetary policy clearly remained on maintaining and extending liquidity support in the economy, impacted by the second wave of Covid. GSAP 2.0, regular LAF operations will ensure adequate liquidity in the system. Further, support for stressed segments through on-tap scheme for contact intensive sectors, expansion of resolution framework 2.0 by increasing limit of loans from 25 Cr to 50 Cr and special liquidity window to SIDBI will help smoothen out stress in the real economy, and this will be beneficial especially to the small borrowers and MSMEs. Maintaining status quo on policy rates and accommodative stance was in-line with street expectations. We believe continuation of low interest rates will boost demand in the housing sector and also aid improve the overall consumption in the economy Naveen Kulkarni, Chief Investment Officer, Axis Securities
The central bank's move to keep rates and policy stance unchanged is on expected lines. RBI's resolve to focus on growth, continue with policy support till growth stabilizes will help the economic recovery. The GSAP 2.0 will ensure ample system liquidity and smooth government borrowing exercise. The industry-focused announcements like allowing banks to restructure MSME loans up to Rs 50 cr from Rs 25 cr earlier, Rs 15,000 crore liquidity window for the contact-intensive hospitality industries like hotel, travel, and tourism will provide relief for these affected sectors, ensure liquidity during these challenging times. The growth of the hospitality sector is key as it generates a large number of jobs. The growth estimates for FY22 have been revised downwards to 9.5% on concerns of the second wave, inflation around the 5% - within the mandated range for FY22 is a positive. Vikash Khandelwal, CEO, Eqaro Guarantees
While the sector has been severely impacted in the second lockdown, the problems have been aggravated with a considerable rise in the cost of raw materials such as steel and cement. In such a scenario, an unchanged repo rate makes more sense than an increased one which would have added more pressure on the sector. However, we also need to be mindful of the impact on prospective home-buyers due to the uncertain conditions. This set of buyers are apprehensive in coming ahead and have instead chosen to wait to buy a home. There is a need for stimulant policy measures that would enhance liquidity for the sector, ease credit provisions and increases buyer’s confidence. Any announcements in these forms would have been much appreciated Surendra Hiranandani, Chairman and Managing Director, House of Hiranandani
Hotel stocks such as Indian Hotels, Lemon Tree Hotels, EIH Associated Hotels, HLV surged up to 20 per cent after the Reserve Bank of India (RBI) Governor Shaktikanta Das announced liquidity support to contact intensive sectors like the Hotel industry. Das announced a separate liquidity window of Rs 15,000 crore to mitigate the adverse second COVID wave impact on certain contact-intensive sectors such as hotels and restaurants.
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MPC meeting outcome was mostly in-line with expectations as RBI, in addition to maintaining status quo about policy rates, focused upon ensuring sufficient liquidity in the system and supported MSMEs and corporate hit in second wave. Special liquidity of Rs160bn for SIDBI to support SMEs and increased on-tab liquidity support of Rs150bn to banks for offering three years tenor of loan to contact-intensive sector augur well to spur economic activities in coming months. Further, incremental bond purchase of Rs400bn on 17th June’21 under G-SAP 1.0 and Rs1.2 trillion in 2QFY22 under G-SAP 2.0 augur well. In our view, reduction in real GDP target for FY22E from 10.5% to 9.5% was mostly on expected line. However, moderate increase in inflation target could be a near term overhang, but it remains under RBI’s reference range. Binod Modi, Head Strategy at Reliance Securities
Reserve Bank of India's decision to keep key policy rates unchanged is in line with our expectation. We appreciate the accommodative stance of the RBI given the tough times the nation is going through with the onset of the second wave of COVID19 pandemic. Although the downward revision of GDP growth forecast for FY22 to 9.5% from 10.5% earlier is a dampener, it reflects the current economic challenges. GSAP 2.0, under which the RBI has proposed to buy government securities worth 1.20 lakh crore rupees in Q2 will open the floodgates of liquidity and is a welcome step. Ravindra Sudhalkar, CEO, Reliance Home Finance
RBI Governor Shaktikanta Das announced a special liquidity facility of Rs 16,000 crore to SIDBI in order to support MSMEs
RBI Governor Shaktikanta Das said that under Resolution Framework 2.0, coverage of Covid 2.0 recast scheme from Rs 25 crore to Rs 50 crore will cover more MSMEs and small businesses
CPI inflation is very much in the target range of the Reserve Bank of India, so at this juncture, accommodative policy with a status quo in the key policy rates is welcome. Expecting an appropriate cut in repo rate in the next review by RBI as depressed demand has to be rejuvenated with enhanced liquidity for businesses and people. Sanjay Aggarwal, President at PHDCCI
RBI maintains accommodative stance, keeping all rates unchanged. vowing to keep conditions as supportive as possible to revive growth. Impact of second wave on inflation could be handled through supply side measures. The policy bodes well for financial assets as well as the real economy, growth and employment as RBI has again stated its resolve to maintain conducive conditions to support durable growth. The policy is pragmatic, at the same time progressive and preemptive in its approach. Sandeep Bagla, CEO Trust AMC
To mitigate the COVID-19 second wave impact on certain contact intensive sectors, a separate liquidity window of Rs 15,000 cr has been opened till March 31, 2022 with tenors of up to 3 years at the repo rate
RBI Governor Shaktikanta Das said that RBI will conduct next leg of G-SAP worth Rs 40,000 crore on June 17, 2021. Of this, Rs 10,000 crore would be part of State Development Loans (SDL)
Foremost endeavour of RBI through the pandemic has been to create conducive financial conditions, so that fin institutions and market continue to function normally
The Reserve Bank of India reduced Q1FY22 GDP forecast to 18.5 per cent from the earlier estimate of 26.2 per cent
Shaktikanta Das said that FY22 real GDP seen at 9.5 per cent. CPI Inflation projected at 5.1% in 2021-22, 5.2% in first quarter; 5.4% in second-quarter; 4.7% in third quarter; and at 5.3 per cent in fourth quarter
BSE Sensex surged to a day's high of 52,389 levels after RBI announced to keep interest rates steady and stance accommodative
RBI Governor Shaktikanta Das said that the forecast of normal monsoon, the resilience of farm economy, gathering global economic recovery can provide tailwinds to the domestic economy as COVID-19 second wave recedes
RBI Governor Shaktikanta Das said that data suggests that India's FY21 GDP contracted 7.3 per cent
Nifty 50 index surged higher to a new record high of 15,730 on Friday, after RBI announced to keep the repo rate unchanged at 4%
The Reserve Bank of India's monetary policy committe continues with 'accommodative' stance
The Reserve Bank of India (RBI's) Monetary Policy Committee maintained the repo rate at 4%
The Nifty is trading above 15700 this morning. It is all poised to achieve 15900-16000 as it's next target. The index has a good support at 15300 and as long as we can respect that, every dip can be utilized to buy into this market. Intra day profit booking or mild corrections cannot be ruled out. Hence traders should look at dips to accumulate long positions so that the risk reward ratio is favorable. Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments
Gold Price Today, Gold Price Outlook, Gold Price Forecast: Gold and silver prices were trading in the negative territory on Friday as yellow metal in international markets fell to near two-week low on upbeat US economic data. On MCX, gold August futures were trading Rs 55 down at Rs 48,622 per 10 gram, against the last close of Rs 48,677. Silver July futures also fell Rs 162 or 0.23 per cent to Rs 70,648 per kg.
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Whenever investors see the Indian Rupee weakening, they unwind carry trades and that results in a sharp fall in the premiums. Yesterday was an odd day when Rupee appreciated up to 72.90 and 1-year premiums fell too up to 313 paise. The 1-year forward rates fell to the lowest when the USDINR pair was at 72.31 last week. Probably, traders unwounded their position heavily ahead of the RBI meet. Expectations are high that RBI will keep the policy interest rates unchanged, announce bond-buying programs and some measures to support affected industries. That apart, RBI’s comments on growth outlook and inflation will be watchful, thereby keeping the rupee under pressure. Amit Pabari, managing director, CR Forex Advisors
The Nifty sectoral indices mostly negative, with Nifty Pharma index down 0.36 per cent, leading the laggards. The nifty Auto index was up over half a per cent.
Nestle India, Hindustan Unilever Ltd (HUL), SBI, HDFC Bank, Titan Company, RIL stocks capped Sensex gains
ONGC, L&T, Tech Mahindra, Mahindra & Mahindra, Power Grid Corporation of India, Bharti Airtel, UltraTech Cement were among top Sensex gainers
BSE Sensex was trading flat with a negative bias at 52,251 while the Nifty 50 index was trading just below 15,700 on Friday ahead of RBI MPC decision.
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The government will have to do its bit to help for a faster recovery and start spending at the earliest, Axis Bank’s chief economist Saugata Bhattacharya said on Thursday, estimating the FY22 GDP growth to come at between 9.5-10 per cent.
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