Markets continue to trade higher post RBI policy decision

Mumbai, Jun 8 (PTI) Equity indices continued their rally in morning trade on Thursday after the Reserve Bank of India opted for a pause second time in a row, maintaining key benchmark policy rate at 6.5 per cent as inflation moderates.

Fresh foreign fund inflows in the domestic equity market also added to the optimism.

The 30-share BSE Sensex climbed 174.2 points to 63,317.16 in morning trade after the monetary policy announcement. The NSE Nifty advanced 49.2 points to 18,775.60.

From the Sensex pack, NTPC, Power Grid, Larsen & Toubro, HDFC Bank, IndusInd Bank, HDFC, State Bank of India, ICICI Bank, UltraTech Cement, Tata Steel and Reliance Industries were the major gainers.

Kotak Mahindra Bank, Mahindra & Mahindra, Tata Consultancy Services, Nestle, Axis Bank, HCL Technologies, Wipro, Tech Mahindra and Hindustan Unilever were among the laggards.

The Reserve Bank of India on Thursday opted for a pause second time in a row, maintaining key benchmark policy rate at 6.5 per cent as inflation moderates.

Announcing the bi-monthly monetary policy, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) unanimously decided to keep the rate unchanged at 6.5 per cent.

“RBI staying on a pause and maintaining its stance was in line with expectations,” said Suvodeep Rakshit, Senior Economist, Kotak Institutional Equities.

In Asian markets, Seoul, Tokyo, Shanghai and Hong Kong were trading lower.

The US markets ended mostly lower on Wednesday.

“The MPC maintained unchanged interest rates, as expected. The market had already factored in this policy, maintaining its bullish momentum,” Santosh Meena, Head of Research, Swastika Investmart Ltd said.

Global oil benchmark Brent crude dipped 0.27 per cent to USD 76.74 a barrel.

Foreign Institutional Investors (FIIs) bought equities worth Rs 1,382.57 crore on Wednesday, according to exchange data.

The Sensex had climbed 350.08 points or 0.56 per cent to settle at 63,142.96 on Wednesday. The NSE Nifty advanced 127.40 points or 0.68 per cent to end at 18,726.40.