Market at day's high; Bajaj Finance spurts 3.52%

The benchmark indices continued to marched higher and hit a fresh intraday high in mid-afternoon trade. The Nifty traded above the 23,250 mark after hitting the days low of 22,789.05 in early trade. Auto shares extended gains for the third consecutive trading session.

At 14:30 IST, the barometer index, the S&P BSE Sensex was surged 1,517.16 points or 2% to 76,576.47. The Nifty 50 index gained 433.25 points or 1.90% to 23,254.65.

In the broader market, the S&P BSE Mid-Cap index rallied 1.90% and the S&P BSE Small-Cap index jumped 2%.

The market breadth was strong. On the BSE, 2,856 shares rose and 934 shares fell. A total of 121 shares were unchanged.

RBI Monetary Policy Outcome:

The Reserve Bank of India (RBI) monetary policy committee (MPC) has voted to keep the repo rate unchanged at 6.5%.

RBI's MPC at its meeting today, 7 June 2024, decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50%. Consequently, the standing deposit facility (SDF) rate remains unchanged at 6.25% and the marginal standing facility (MSF) rate and the Bank Rate at 6.75%.

The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, 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 projected real GDP growth for 2024-25 has been revised upward to 7.2%. The quarterly breakdown is as follows: Q1 at 7.3%, Q2 at 7.2%, Q3 at 7.3%, and Q4 at 7.2%. This represents a slight improvement from the previous estimate, where the GDP growth was projected at 7%, with Q1 at 7.1%, Q2 at 6.9%, Q3 at 7%, and Q4 also at 7%. The risks associated with this projection are considered evenly balanced.

The projected CPI inflation for 2024-25 remains unchanged at 4.5%. The quarterly breakdown is as follows: Q1 at 4.9%, Q2 at 3.8%, Q3 at 4.6%, and Q4 at 4.5%. This is consistent with the previous meeting's projection, where CPI inflation for the same period was also estimated at 4.5%, with Q1 at 4.9%, Q2 at 3.8%, Q3 at 4.6%, and Q4 at 4.5%.

The minutes of the MPCs meeting will be published on 21 June 2024. The next meeting of the MPC is scheduled during August 6 to 8, 2024.

Buzzing Index:

The Nifty Auto index surged 2.28% to 24,952.50. The index rallied 7.58% in three consecutive trading sessions.

Mahindra & Mahindra (up 5.29%), Samvardhana Motherson International (up 3.57%), Tata Motors-DVR (up 3.26%), Balkrishna Industries (up 3.04%), Tata Motors (up 2.68%), Apollo Tyres (up 2.6%), Ashok Leyland (up 2.04%), Bharat Forge (up 1.79%), Hero MotoCorp (up 1.1%) and Maruti Suzuki India (up 0.85%) advanced.

Numbers to Track:

The yield on India's 10-year benchmark federal rose 0.01% to 7.016 as compared with previous close 7.016.

In the foreign exchange market, the rupee is edged higher against the dollar. The partially convertible rupee was hovering at 83.4225, compared with its close of 83.5300 during the previous trading session.

MCX Gold futures for 5 August 2024 settlements fell 1.11% to Rs 72,320.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.02% to 104.12.

The United States 10-year bond grew by 0.35% to 4.293.

In the commodities market, Brent crude for Aug 2024 settlement lost 19 cents or 0.24% to $79.68 a barrel.

Stocks in Spotlight:

Bajaj Finance rallied 3.52% after the NBFCs board approved the offer for sale (OFS) of equity shares of a wholly owned subsidiary, Bajaj Housing Finance (BHFL), aggregating to Rs 3,000 crore through initial public offer (IPO).

Rites rose 0.36%. The company said that it has received a letter of award (LoA) from Tata Steel for Loco Hiring along with operation and maintenance.

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