Stocks rally on RBI’s stance, GDP outlook
The Sensex rallied 447 points to close above the 45,000-level for the first time on Friday, tracking strong buying in financial stocks after the Reserve Bank of India (RBI) left interest rates unchanged for the third straight time amid persistently high inflation, but said the economy was recuperating fast and would return to positive growth in the current quarter itself.
The broader NSE Nifty touched a new high of 13,280.05 during the session, before finishing 124.65 points, or 0.95%, higher at 13,258.55 — its record closing high.
Rate-sensitive banking, financial, realty and auto stocks rallied after the policy announcement.
ICICI Bank was the top gainer in the Sensex pack, rising about 4%, followed by UltraTech Cement, Sun Pharma, Bharti Airtel, HUL, SBI, L&T, Axis Bank and IndusInd Bank.
The RBI’s Monetary Policy Committee (MPC) “decided to continue with the accommodative stance... as long as necessary - at least through the current financial year and into the next year,” RBI Governor Shaktikanta Das said.
Gaurav Dua, Head - Capital Market Strategy and Investments, at Sharekhan by BNP Paribas, said growth remains high on the priority of RBI.
“The commentary is dovish in spite of the elevated level of inflationary pressure. It essentially means the liquidity situation would be comfortable and interest rates likely to remain soft in the near term,” he added.