Share Market Today: Indices snap 7-session shedding streak, Sensex surges over 1,000 factors submit RBI fee hike

The benchmark indices–Sensex and Nifty–snapped seven-session shedding streak and ended over 1.6 per cent larger on Friday led by banking, monetary and metallic shares after the Reserve Bank of India (RBI) hiked its repo fee by 50 foundation factors (bps) to five.90 per cent in a bid to convey down the inflation.

The S&P BSE Sensex surged 1,016.96 factors (1.80 per cent) to finish at 57,426.92 whereas the Nifty 50 rallied 276.25 factors (1.64 per cent) to settle at 17,094.35. Both the indices had opened on a weak notice earlier within the day forward of the MPC announcement however quickly recovered from their lows and climbed round 2.3 per cent within the intraday commerce with the Sensex hitting a excessive of 57,722.63 and the broader Nifty touching 17,187.10.

On the Sensex pack, Bharti Airtel, IndusInd Bank, Bajaj Finance, Titan Company, HDFC Bank, Tata Steel, Bajaj Finserv, Kotak Mahindra Bank and ICICI Bank have been the highest gainers on Friday. In distinction, Dr. Reddy’s Laboratories, Asian Paints, ITC and Hindustan Unilever (HUL) ended marginally decrease.

The RBI raised its benchmark lending fee by 50 bps to five.90 per cent, its fourth consecutive fee hike, in a bid to examine the raging inflation which has remained above the 6 per cent tolerance degree for the previous eight months. So far within the ongoing monetary 12 months 2022-23, the central financial institution has raised the benchmark fee by 190 bps.

Commenting available on the market, Santosh Meena, Head of Research at Swastika Investmart mentioned, “The Indian equity market witnessed a sharp bounceback after a seven-day fall. The fall in the dollar index and no negative surprise by the RBI led to a strong short-covering in the market. Technically, the Nifty was sitting near the 16,800-16,635 demand zone and derivative data was extremely oversold as FIIs started the October series with 87 per cent short positions in the index future. Therefore, we are seeing a powerful short-covering rally. The Nifty witnessed a bullish engulfing candlestick pattern on the daily chart from the support of the 100-DMA, which is a very encouraging sign for the bulls. On the upside, 17,190 is an immediate hurdle, and 17,325-17,425 is the next critical supply zone.”

All the sectoral indices on NSE ended larger on Friday with the Bank Nifty surging 2.61 per cent to shut at 38,631.95, Nifty Financial Services rallying 2.24 per cent to 17,506.65 and the Nifty Metal index gaining 2.17 per cent to five,768.20.

“Bank Nifty also witnessed a sharp bounce back from the psychological support level of 37,500. Above this level, we can expect a move towards the 39,700 level which may coincide with the 20-DMA,” Meena mentioned.

In the broader market indices, the S&P BSE MidCap index rallied 340.97 factors (1.39 per cent) to 24,853.94 whereas the S&P BSE SmallCap surged 405.80 factors (1.45 per cent) to twenty-eight,452.91. On NSE, the volatility index or India VIX slumped 6.26 per cent to 19.97.

Vinod Nair, Head of Research at Geojit Financial Services famous, “An in-line rate hike along with the RBI’s confidence in the economy’s growth momentum aided the domestic market to alter the seven-day losing streak. The decision to retain inflation at 6.70 per cent with a marginal cut but a healthy GDP forecast of 7.0 per cent indicates the resilience of the Indian economy. Although the commentary warned about prevailing risks to the domestic economy from the global economy, the MPC refrained from sounding very hawkish. Continuation of the policy stance as ‘withdrawal of accommodation’ indicates more rate hikes in the future, but data-driven.”