RBI policy meet lifts key Indian equity markets' spirits (Roundup)

Key Indian equity market indices surged and ended higher on Tuesday as the accommodative monetary policy stance of the Reserve Bank of India (RBI) lifted the investors' mood.

The 30-scrip Sensitive Index (Sensex) of the BSE moved up as soon as the RBI policy was announced and after that it maintained a constant upward movement.

The Sensex, which opened at 26,833.54 points, closed at 27,009.67 points -- up 232.22 points, or 0.87 percent over the previous day's close at 26,777.45 points.

It touched a high of 27,082.63 points and a low of 26,829.53 points in the day's trade.

Out of the 30 scrips in the Sensex, 26 ended in the green and only four in the red.

The wider Nifty of the National Stock Exchange closed 65.40 points or 0.80 percent up at 8,266.45 points.

The RBI on Tuesday left its key policy rates and reserve ratios unchanged, concerned over the slight rise in inflation and some domestic and global upside risks that have sprung up since April.

The decision was taken at the second bi-monthly policy review for the current fiscal by Reserve Bank Governor Raghuram Rajan at its headquarters here.

"Since the RBI policy meet was in line with expectation, the market has moved ahead along the momentum which is looking promising. Strong uptick in earnings and the expectations from parliament's monsoon session, when GST (Goods and Services Tax Bill) will be tabled, are leading India's out-performance in the emerging markets," said Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services.

"RBI maintaining status quo helped Indian markets to resume the uptrend, and follow global markets seemingly energised by (US Fed chair Janet) Yellen's statement yesterday suggesting lower chances of a US rate hike," said Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services.

"However, gains were capped, with (RBI) Governor maintaining a mildly hawkish stance in its statement, pointing towards stiff inflation, and the potential impact of Brexit," he aded.

The 100-scrip and 200-scrip indices of the BSE were up by 0.73 percent and 0.72 percent, respectively. The mid-cap index was higher by 0.29 percent, while small-cap stocks were up by 0.96 percent.

In Tuesday's trade, good buying was observed in realty, banking, consumer durables, fast moving consumer goods (FMCG) and finance sectors. Selling pressure was seen in oil and gas sector.

Sector-wise, the S&P BSE realty index surged by 1.70 per cent, bankex gained by 1.63 per cent, consumer durables index moved up by 1.57 per cent, FMCG index increased by 1.35 per cent, and finance index went up by 1.08 per cent. However, oil and gas index fell by 0.14 per cent.

The major Sensex gainers on Tuesday were: State Bank of India, up 5.40 per cent at Rs 209.80; ICICI Bank, up 4.31 per cent at Rs 253.85; ITC, up 1.97 per cent at Rs 362.80; and Sun Pharma, up 1.77 per cent at Rs 738.80.

The losers were: Infosys, down 0.78 per cent at Rs 1,257.20 and Reliance Industries, down 0.13 per cent at Rs 954.65.

Among the Asian markets, Japan's Nikkei was up by 0.58 per cent, China's Shanghai Composite Index ended higher by 0.07 per cent and Hong Kong's Hang Seng gained by 1.42 per cent.

In Europe, London's FTSE 100 was higher by 0.48 per cent, Germany's DAX Index was up by 1.77 per cent, and France's CAC 40 was higher by 1.25 percent at the closing of the Indian markets.

--IANS

ag/vt