After the increase in the repo rate in the stock market, the momentum returned, the Sensex rose 89 points
Highlights
- Sensex closed 89.13 points or 0.15 per cent higher at 58,387.93
- Nifty closed at 17,397.50 with a slight gain of 15.50 points
- RBI hikes repo rate by 0.50 percent to 5.40 percent
Share Market Both the benchmark indices closed with marginal gains on Friday amid a mixed trend in global markets and the decision to hike policy interest rates. Traders said sustained inflow of foreign capital into capital markets and softening crude oil prices also supported the Sensex and Nifty. The BSE 30-share Sensex rose 89.13 points, or 0.15 per cent, to 58,387.93 points. During the trading, the Sensex had also registered a rise of 350.39 points at one time. Although there was a lot of volatility in the last hour, the Sensex managed to maintain a slight lead. On the other hand, the Nifty of the National Stock Exchange closed at 17,397.50 with a slight gain of 15.50 points, or 0.09 percent.
Total increase in repo rate by 1.40% in three months
Market movements were also affected by the announcement of a policy rate hike by the Reserve Bank of India (RBI). RBI has increased the repo rate by 0.50 percent to 5.40 percent, which is the third hike in the last three months. The repo rate in February, 2020, before the pandemic hit, was 5.15 per cent. RBI Governor Shaktikanta Das also indicated that the trend of increasing interest rates may continue. Inflation continues to remain above the comfortable level of 6 per cent and to control it, the RBI has increased the repo rate by a total of 1.40 per cent in three months.
Tensions between China and Taiwan will remain focused
Sujan Hazra, Chief Economist and Executive Director, Anand Rathi Shares and Stock Brokers, said, “The RBI’s announcement of a 0.50 per cent hike in the repo rate is in line with broadly accepted expectations.” UltraTech Cement remained the top firm with a strength of 2.86 per cent. ICICI Bank, Bharti Airtel, PowerGrid, Infosys, Wipro and Axis Bank also gained. On the other hand, Mahindra & Mahindra suffered a loss of 2.04 percent as the first quarter results were not as expected. Maruti Suzuki, Reliance Industries, IndusInd Bank, Bajaj Finserv, SBI and Tata Steel also ended in losses. A total of 817.68 points or 1.42 percent increase was recorded in the Sensex this week. On the other hand, Nifty increased by 239.25 points or 1.39 percent during this period. Amol Athawale, deputy vice-president (technical research), Kotak Securities Limited, said, “With the monetary policy pressure receding, the focus will now remain on the tensions between China and Taiwan. In the broader market, BSE Smallcap was up 0.23 per cent while Midcap gained 0.09 per cent. Global markets were mixed.
Asian market closed with gains
In Asian markets, South Korea’s Kospi, China’s Shanghai Composite, Japan’s Nikkei and Hong Kong’s Hang Seng closed with gains. European markets saw a decline in the afternoon session. A day earlier on Thursday, a mixed trend was seen in the US markets. Meanwhile, international oil benchmark Brent crude rose 0.18 per cent to $94.29 a barrel. Apart from this, the rupee strengthened against the US dollar. The rupee strengthened by 17 paise to close at Rs 79.23 per dollar (provisional). Foreign institutional investors have maintained a buying trend in the Indian market. According to available data, foreign investors bought shares worth Rs 1,474.77 crore on Thursday.
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