Sensex, Nifty stage a stellar recovery after RBI rate hike; banking stocks lead gains

Benchmark indices staged a stellar recovery on Friday following the Reserve Bank of India's interest rate decision. Sensex and Nifty closed higher after seven consecutive sessions of fall. Sensex jumped 1,016.96 points or 1.80 per cent to end at 57,426.92. During the day, it rallied 1,312.67 points or 2.32 per cent to 57,722.63. Nifty climbed 276.25 points or 1.64 per cent to close at 17,094.35.

On the Indian markets snapping seven sessions of losses, Abhijeet from Tips2trade said, "Slightly positive commentary by RBI regarding the Indian economy vis a vis global economy with a short covering frenzy due to oversold markets has unexpectedly led to a sharp uptrend in all indices including BSE Sensex today. A daily close above 57,270 should lead to a further uptrend towards 57,650 and 58100 in the near term. Immediate support is at 56,860."

Bharti Airtel, IndusInd Bank, Bajaj Finance, Titan, Kotak Mahindra Bank, HDFC Bank, and Tata Steel were the top Sensex gainers, rising up to 4.49 per cent. Dr Reddy's, Asian Paints, ITC and Hindustan Unilever were the top Sensex losers, falling up to 1.26 per cent. 

The RBI on Friday raised the benchmark lending rate by 50 basis points to 5.90 per cent in a bid to check inflation, which has remained above its tolerance level for the past 8 months. In all, RBI has raised the benchmark rate by 1.90 per cent since May this year.

Share Market News Today Live: Sensex zooms 1,017 points, Nifty settles near 17,100; bank, financial stocks climb on RBI rate hike

"The 50 bps rate hike by the RBI in today's meeting was in line with expectations. The key highlights were the resilience shown by the Indian economy considering the turbulent global environment and concerns emanating from global growth slowdown and hawkish stances of various central banks," said Santosh Meena, Head of Research at Swastika Investmart Ltd.

Mid-cap and small-cap indices on BSE rose 341 points and 405 points, respectively. Consumer durables, banking and capital goods were the top sectoral gainers with their BSE indices zooming 818 points, 1131 pts and 534 pts, respectively. 

Market breadth was positive with 2,335 stocks ending higher against 1,107 stocks falling on BSE. 96 shares were unchanged. Market cap of BSE-listed firms rose to Rs 271.86 lakh crore against Rs 268.24 lakh crore in the previous session. 

Foreign institutional investors sold shares worth a net Rs 3,599.42 crore on Thursday, according to data available with BSE.

Rupee ends higher 

Meanwhile, the rupee extended initial gains and closed 37 paise higher at 81.36 against the US dollar. At the interbank forex market, the currency opened at 81.60 against the greenback. It witnessed an intra-day high of 81.17 and a low of 81.69 during the session.

Previous session

The Indian market ended lower for the seventh straight session on Thursday amid weak global cues and continuous foreign fund outflows. Sensex fell 188 points to end at 56,409. The global weakness trimmed gains on Indian indices in the afternoon session with Nifty closing 40 points lower at 16,818. Asian Paints,Tech Mahindra, Titan, Kotak Bank and Bajaj Finance were the top Sensex losers, falling up to 4.55 per cent. ITC, Dr Reddy's and Tata Steel were among the top Sensex gainers, rising up to 2.51 per cent. 

Global markets

Elsewhere in Asia, markets in Seoul, Tokyo and Shanghai ended lower, while Hong Kong settled higher. Stock exchanges in Europe were trading in the green in mid-session deals. The US markets had ended sharply lower on Thursday. Meanwhile, the international oil benchmark Brent crude futures jumped 1.19 per cent to $89.54 per barrel.