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Domestic equities plunged on Thursday after the Reserve Bank of India’s (RBI’s) monetary policy committee kept the key lending rate unchanged at 6.50 per cent. BSE benchmark Sensex slipped 307.63 points, or 0.47 per cent lower at 65,688.18, while broader NSE Nifty slipped 89.45 points, or 0.46 per cent to end the session at 19,543.10.
While announcing the bimonthly policy, RBI Governor Shaktikanta Das said that the headline inflation after reaching a low of 4.3 per cent in May 2023, rose in June and is expected to surge during July and August, led by vegetable prices. The RBI also raised the the CPI inflation forecast for FY2023-24 to 5.4 per cent from 5.1 per cent due to vegetable price shocks, while retained the GDP forecast at 6.5 per cent, with risks evenly balanced.
FMCG, and bank stocks extended fall today, after RBI increased the inflation projection, and asked banks to set aside a larger part of incremental deposits under cash reserve ratio (CRR) to tighten liquidity in the near term.
Nifty FMCG slipped 0.91 per cent, followed by the PSU Bank index at 0.81 per cent. Nifty Healthcare Index slipped 0.85 per cent today, financial services fell 0.77 per cent, Nifty Bank closed 0.76 per cent, and pharma fell 0.74 per cent.
Meanwhile, Nifty Media spurt 6.63 per cent, led by gains in Zee Entertainment after NCLT approved the merger of the company with Sony India, and dismissed all objections. Zee’s stock zoomed 20 per cent today, but closed 16.18 per cent lower at Rs 281 on NSE.
Broader markets also extended the losses, as Nifty Smallcap 50 fell 0.52 per cent, Nifty Smallcap 250 slipped 0.25 per cent, Nifty 100 and Nifty Smallcap 100 slumped 0.47 per cent, and Nifty 200 closed 0.41 per cent down.
Adani Enterprises, Adani Ports, IndusInd Bank, Titan, ONGC, JSW Steel, M&M, BPCL, Bajaj Finance, Tech Mahindra, Power Grid, Reliance, Bajaj Finserv, and Divis Lab were the top gainers today.
Asian Paints, Kotak Mahindra Bank, Britannia, ITC, Nestle India, Apollo Hospital, Tata Consumers, SBI Life, Axis Bank, Bharti Airtel, ICICI Bank and HDFC Bank were the top drag.
