Barometers turn rangebound; Nifty hovers above 17,850

The key benchmark indices traded with major gains in a narrow range in mid-afternoon trade. The Nifty hovered above the 17,850 level. All the sectoral indices on the NSE were in the green.

At 13:30 IST, the barometer index, the S&P BSE Sensex, was up 473.31 points or 0.79% to 60,759.35. The Nifty 50 index added 161.65 points or 0.91% to 17,883.15.

In the broader market, the S&P BSE Mid-Cap index rose 0.95% while the S&P BSE Small-Cap index gained 0.77%.

The market breadth was positive. On the BSE, 1,955 shares rose, and 1,484 shares fell. A total of 143 shares were unchanged.

RBI Monetary Policy Outcome:

The Reserve Bank of India (RBI) raised the key policy repo rate by 25 basis points and said it remained focused on the withdrawal of accomodation.

On the basis of an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting today (8 February 2023) decided to increase the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points to 6.50% with immediate effect.

Consequently, the standing deposit facility (SDF) rate stands adjusted to 6.25% and the marginal standing facility (MSF) rate and the Bank Rate to 6.75%.

The MPC also decided by a majority of 4 out of 6 members to remain focused on withdrawal of accommodation to ensure that inflation remains within the target going forward, while supporting growth.

These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2%, while supporting growth.

The outlook for inflation is mixed. Inflation is projected to be at 6.5% in 2022-23, with Q4 at 5.7%. On the assumption of a normal monsoon, CPI inflation is projected at 5.3% for 2023-24, with Q1 at 5%, Q2 at 5.4%, Q3 at 5.4% and Q4 at 5.6%, and risks evenly balanced.

Real GDP growth for 2023-24 is projected at 6.4% with Q1 at 7.8%, Q2 at 6.2%, Q3 at 6% and Q4 at 5.8%, and risks broadly balanced.

"The global economic outlook does not look as grim now as it did a few months ago. Growth prospects in major economies have improved, while inflation is on a descent, though it still remains well above the target in major economies," RBI Governor Shaktikanta Das said in his statement.

"Inflation is expected to average 5.6% in Q4:2023-24," he added.

Numbers to track:

The yield on India's 10-year benchmark federal paper advanced to 7.348 from its close of 7.309 recorded in the previous trading session.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 82.58, compared with its close of 82.70 during the previous trading session.

MCX Gold futures for 5 April 2023 settlement advanced 0.11% to Rs 57,319.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.31% to 103.11

The United States 10-year bond yield declined 0.32% to 3.662.

In the commodities market, Brent crude for March 2023 settlement advanced 0.34 cents or 0.41% to $84.03 a barrel.

Buzzing Index:

The Nifty Pharma index rose 1% to12,313.05. The index had declined 0.01% in the past trading session.

Gland Pharma (up 4.68%), Aurobindo Pharma (up 3.62%), Alkem Laboratories (up 3.26%), Glaxosmithkline Pharmaceuticals (up 3.1%) and Lupin (up 3.08%), Divis Laboratories (up 2.35%), Biocon (up 1.96%), Granules India (up 1.49%), Laurus Labs (up 1.3%) and Dr Reddys Laboratories (up 1.04%) advanced

On the other hand, Zydus Lifesciences (down 1.59%), Sanofi India (down 0.44%) and Pfizer (down 0.14%) edged lower.

Stocks in Spotlight:

Shree Cement fell 1.37% after the company's consolidated net profit tumbled 44% to Rs 276.77 crore in Q3 FY23 from as against Rs 491.99 crore posted in Q3 FY22. Revenue from operations rose by 15% YoY to Rs 4,068.79 crore in the quarter ended 31 December 2022.

Sobha declined 0.65%. The real estate company's consolidated net profit tumbled 47.9% to Rs 31.80 crore in Q3 FY23 as against Rs 61 crore posted in Q3 FY22. Net sales stood at Rs 868.20 crore in the quarter ended 31 December 2022, recording a growth of 39.5% from Rs 622.30 crore reported in the same period last year.

One 97 Communications (Paytm) surged 5.46% after the company's lending business witnesses a 327% year on year (YoY) growth in disbursements to Rs 3,928 ($480 million) in January 2023.

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