CHENNAI: Indian equity markets experienced a significant rally today, spurred by the Reserve Bank of India's (RBI) unexpected policy measures aimed at stimulating economic growth. The RBI slashed the key repo rate by 50 basis points and reduced the Cash Reserve Ratio (CRR) by 100 basis points, injecting approximately ₹2.5 lakh crore into the banking system. This aggressive easing, coupled with a shift in the RBI's policy stance from 'accommodative' to 'neutral', boosted investor sentiment across sectors.
The apex bank's bold policy actions have injected liquidity and optimism into the markets, particularly benefiting rate-sensitive sectors. Financials, real estate, and automobiles have emerged as key beneficiaries, with significant gains observed across these indices.
Financials & Banking
Nifty Bank Index surged to an all-time high of 56,433, marking a 1.2% gain. Key contributors included HDFC Bank, State Bank of India (SBI), and Axis Bank, each rising over 2%. Nifty PSU Bank Index also reached new highs, reflecting strong performance in public sector banks.
Financial services stocks such as Shriram Finance led the rally with a 4% increase, indicating robust investor confidence in the sector.
Real Estate
Nifty Realty Index climbed 3%, driven by expectations of improved affordability and demand. The Union Budget 2025's measures, including a higher TDS limit on rent, further bolstered investor sentiment.
Top performers in the index included Prestige Estates and Godrej Properties were among the leading gainers, reflecting strong market interest in real estate stocks.
Automobiles
Nifty Auto Index advanced by 1%, with Ashok Leyland gaining 3.4% following a bullish outlook from Morgan Stanley.
Other notable gainers in today's rally were Mahindra & Mahindra and Samvardhana Motherson International, indicating positive investor sentiment in the sector.
However, analysts feel that investors should monitor these sectors closely, as the policy measures are expected to sustain positive momentum in the near term.