Source : INDIA TODAY NEWS
Benchmark stock market indices opened higher on Friday as investors awaited the Reserve Bank of India’s monetary policy decision for cues on interest rates, inflation and the rupee outlook.
The S&P BSE Sensex rose 191.96 points, or 0.26%, to 74,551.97 in early trade, while the NSE Nifty50 gained 39 points, or 0.17%, to 23,455.55.
Market participants are closely watching the RBI‘s policy announcement, with economists expecting the central bank to keep the repo rate unchanged at 5.25%. However, investors will focus on Governor Sanjay Malhotra’s commentary for clues on future rate moves and measures to support the rupee, which has been among Asia’s weakest currencies this year.
Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said there are some early signs of weakness in the global AI trade, although it is too soon to call it a trend.
“There are signs of weakness in the AI trade in the US, South Korea and Taiwan and rotation away from tech stocks, but it is too early to say whether this will sustain,” he said.
RBI POLICY TAKES CENTRE STAGE
According to Vijayakumar, the RBI is likely to maintain rates but signal that inflation risks remain elevated.
“The MPC is likely to hold rates with a guidance of a rate hike later in the year to combat inflation which is expected to rise in H2 FY27. The most likely policy action is a ‘hawkish hold’,” he said.
He added that if the RBI unexpectedly raises rates now, banking stocks could benefit, while rate-sensitive sectors such as automobiles and real estate may come under pressure.
The RBI’s policy decision is the biggest trigger for markets today.
According to a Reuters poll, the central bank is expected to leave interest rates unchanged. However, concerns over rising inflation due to higher crude oil prices and the weakening rupee have increased expectations that the RBI could adopt a hawkish stance.
Investors will also watch for any revisions to the RBI’s GDP growth and inflation forecasts following the recent energy shock caused by tensions in West Asia.
TECH STOCKS LEAD EARLY GAINS
Information technology stocks provided support to the market in early trade.
Tech Mahindra emerged as the top gainer on the Sensex, rising 2.06%, followed by Mahindra & Mahindra which gained 1.37%.
Bajaj Finance climbed 1.21%, Bajaj Finserv rose 1.17%, while TCS added 0.88%. Infosys also traded higher, gaining 0.82%.
The gains in IT stocks come amid signs that the AI-driven rally in global technology stocks may be losing momentum, prompting investors to reassess valuations across global markets.
On the downside, Trent was the biggest loser on the Sensex, falling 0.61%.
Tata Steel declined 1.16%, while IndusInd Bank slipped 0.30%. Power Grid Corporation lost 0.26% and Reliance Industries fell 0.23%.
BROADER MARKETS OUTPERFORM
The broader market continued to outperform benchmark indices.
The Nifty Midcap 100 gained 0.55%, while the Nifty Smallcap 100 rose 0.34%.
India VIX, the market’s volatility gauge, fell 1.71% to 15.61, indicating slightly lower nervousness among investors.
Among sectoral indices, Nifty Media gained 1.65%, Nifty Realty rose 0.98%, Nifty Healthcare advanced 0.79%, and Nifty Financial Services climbed 0.67%.
Nifty Metal was the only major laggard, falling 0.58%.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)
– Ends
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SOURCE :- TIMES OF INDIA
