Mumbai: Indian stock markets surged on Friday, buoyed by the Reserve Bank of India’s (RBI) major policy decisions, including a 50 basis point cut in the repo rate to 5.50% and a 100 basis point reduction in the cash reserve ratio (CRR), implemented in four phases.
The benchmark Sensex jumped 746.95 points (0.92%) to close at 82,188.99, while the Nifty surged 252.15 points (1.02%) to end the day at 25,003.05 — crossing the 25,000 mark for the first time in several sessions.
The rally was led by banking stocks. The Nifty Bank index soared 817.55 points (1.47%) to settle at 56,578.40, hitting an intraday high of 56,695 — the highest level ever recorded for the index.
Broad market indices also saw strong gains. The Nifty Midcap 100 rose 707.30 points (1.21%) to 59,010.30, while the Nifty Smallcap 100 climbed 149.85 points (0.81%) to 18,582.45.
Rupak De, Senior Technical Analyst at LKP Securities, said the market responded sharply to the RBI’s aggressive monetary easing.
“Closing above the 25,000 mark reflects a clear uptick in investor sentiment. Historically, such rallies followed by consolidation phases often lead to further breakouts — and we anticipate the Nifty may break above its recent consolidation zone,” he explained.
Analysts believe that the substantial rate cut and added liquidity from the CRR reduction will accelerate the transmission of lower interest rates, reinforcing the RBI’s focus on boosting economic growth, investment, and consumption.
Rate-sensitive sectors like banking, real estate, automobiles, and consumer durables led the charge.
Looking ahead, experts expect the effects of the rate cut to continue supporting market momentum.
“Rate-sensitive sectors, along with select themes like railways, are likely to remain in focus. Other sectors may contribute in rotation. We recommend a ‘buy on dips’ approach, focusing on selective stock opportunities,” said Ajit Mishra, SVP of Technical Research at Religare Broking Ltd.
With inputs from IANS