Indices trade with minor losses; PSU bank share decline

The key equity benchmarks traded with small losses in the early afternoon after the Reserve Bank of India (RBI) maintained a status quo in its latest policy announcement. As widely expected by the Street, the Monetary Policy Committee (MPC), chaired by Governor Sanjay Malhotra, retained a neutral stance and left all key interest rates unchanged, keeping the benchmark repo rate steady at 5.25%.

The Nifty traded below the 25,650 mark. PSU Bank shares declined after advancing for previous four consecutive trading sessions.

At 11:28 ST, the barometer index, the S&P BSE Sensex, fell 92.37 points or 0.11% to 83,217.16. The Nifty 50 index fell 46.85 points or 0.18% to 25,595.95.

 

The broader market underperformed the frontline indices. The BSE 150 MidCap Index fell 0.82% and the BSE 250 SmallCap Index tanked 0.82%.

The market breadth was weak. On the BSE, 1,422 shares rose and 2,388 shares fell. A total of 202 shares were unchanged.

RBI MPC:

The Reserve Bank of India (RBIs) Monetary Policy Committee (MPC) held its first monetary policy review of the calendar year 2026. RBI governor Sanjay Malhotra kept the key policy rate - repo rate unchanged at 5.25%. Headline inflation during November and December remained below the tolerance band of the inflation target. The revised outlook for CPI inflation in Q1 and Q2 of next year, at 4% and 4.2% respectively, revise slightly upwards, said RBI governor Sanjay Malhotra. The Indian economy continues on a steady, improving trajectory, with real GDP poised to register significant higher growth of 7.4% this year, as compared to the previous year, amidst global headwinds, the governor noted. Going forward, economic activity is expected to hold up well in the next year, he added.

Buzzing Index:

The Nifty PSU Bank index fell 1.40% to 8,797.20. The index added 3.28% in the previous four consecutive trading session.

Canara Bank (down 1.49%), Punjab National Bank (down 1.47%), State Bank of India (down 1.43%), Bank of Baroda (down 1.34%), Union Bank of India (down 1.32%), Indian Bank (down 1.1%), UCO Bank (down 0.7%), Bank of India (down 0.68%), Indian Overseas Bank (down 0.66%) and Central Bank of India (down 0.49%) declined.

Most bank stocks declined on Friday after the Reserve Bank of Indias Monetary Policy Committee kept the policy repo rate unchanged at 5.25% at the end of its meeting on February 6, 2026.

The MPC voted unanimously to retain the repo rate under the liquidity adjustment facility at 5.25%. As a result, the standing deposit facility rate remains at 5.00%, while the marginal standing facility rate and the Bank Rate continue at 5.50%. The committee also decided to maintain its neutral policy stance.

In its statement, the RBI said the global economy showed notable resilience in 2025, supported by trade front-loading, a milder-than-expected impact of tariffs, broad fiscal stimulus, and accommodative monetary policy. Inflation is easing gradually, although it remains above target in several advanced economies. US bond yields continue to trade with an upward bias as expectations of near-term rate cuts recede amid firm economic data. Global equities have advanced, led by sustained investments in technology stocks, even as fiscal pressures, geopolitical uncertainty, and monetary policy divergence keep financial markets volatile.

On the domestic front, the RBI raised its real GDP growth forecast for FY26 to 7.4% from 7.3% earlier. Growth projections for Q1 FY27 and Q2 FY27 were revised upwards to 6.9% and 7.0%, respectively.

The central bank raised its CPI inflation forecast for FY26 to 2.1% from 2%. Inflation for Q4 FY26 is projected at 3.2%, while CPI inflation for Q1 FY27 and Q2 FY27 is expected at 4.0% and 4.2%, respectively.

The MPC noted that external headwinds have intensified since the previous policy meeting, although the successful completion of recent trade deals bodes well for the overall economic outlook. It added that the near-term domestic growth and inflation outlook remains positive.

Looking ahead, the committee said it will continue to be guided by evolving macroeconomic conditions and incoming data from the new statistical series while charting the future course of monetary policy.

The minutes of the MPC meeting will be released on 20 February 2026. The next policy meeting is scheduled for April 6-8, 2026.

Stocks in Spotlight:

Bharti Airtel added 1.61%. The company reported a 55.14% decline in consolidated net profit to Rs 6,630.5 crore, despite a 19.62% jump in revenue from operations to Rs 53,981.6 crore in Q3 FY26 over Q3 FY25.

Data Patterns (India) rallied 8.70% after the companys standalone net profit jumped 30.54% to Rs 58.30 crore on a 47.92% surge in revenue from operations to Rs 173.13 crore in Q3 FY26, compared with Q3 FY25.

Life Insurance Corporation of India (LIC) rallied 6.88% after its consolidated net profit climbed 17.5% YoY to Rs 12,930.44 crore in Q3 FY26. Total income jumped 15.7% YoY to Rs 236,776.30 crore during the quarter.

Bharti Hexacom added 6.08% after it has recorded a 48.7% jump in standalone net profit to Rs 481.29 crore on 4.8% rise in revenue from operations to Rs 2,359.90 crore in Q3 FY26 over Q3 FY25.

Global Markets:

Asian market edged lower as South Korea led the losses on Friday, following the tech-driven sell off on Wall Street.

South Koreas market, which is heavily weighted in favor of companies in the chip and automotive industries, have seen sharp swings in the past week as sentiment over tech stocks sours.

Pharmaceutical stocks in Japan also slumped on Friday, after U.S. President Donald Trump unveiled his website offering discounted prescription medicines.

On the commodities front, spot silver prices continued their decline, falling 1.63% after crashing about 13% on Thursday.

Overnight in the U.S., the Dow Jones Industrial Average shed 1.20%, while the S&P 500 lost 1.23%, pushing it into negative territory for the year. The tech-heavy Nasdaq Composite posted the biggest decline, dropping 1.59%.

Tech giant Alphabet came under pressure after reporting fourth-quarter results and flagging a sharp rise in artificial intelligence spending, with capital expenditure totaling $185 billion for 2026.

Qualcomm slid more than 8% after posting a weaker forecast because of a global memory shortage.

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