Indian Stock Market Soars as RBI's Bold Rate Cuts Ignite Investor Confidence

The Indian stock market rallied for the fourth consecutive session, spurred by the RBI's decision to slash the repo rate and CRR. This boost has invigorated financial stocks, driving the Sensex and Nifty indices upward. Banking stocks shone brightly, with the Bank Nifty index reaching record highs.

The Indian stock indices concluded Monday positively, marking their fourth successive session of gains. This upward trend aligns with the Reserve Bank of India's recent decision to cut the repo rate by 50 basis points, propelling the Sensex to 82.445.21, a 0.31% increase, and the Nifty to 25,103.20, a rise of 0.40%.

Financial stocks extended their upward momentum, bolstered by the RBI's aggressive policy measures, including rate and CRR cuts. These strategic actions have strengthened investor confidence, promising enhanced liquidity in the near to medium term, particularly in midcap stocks, according to Vinod Nair, Head of Research at Geojit Investments Limited. Most Nifty sectoral indices closed in the green, with Nifty Financial Services Ex-Bank leading the charge, followed by Nifty PSU Bank and Nifty Oil & Gas.

Banking stocks emerged as the standout performers, with the Bank Nifty index reaching a milestone by surpassing the 57,000 mark for the first time. This reflects the market's optimism post-RBI's unexpected rate cuts. The latest US jobs data also contributed to the positive sentiment, with 1,39,000 jobs added recently. Furthermore, renewed hope in U.S.-China trade discussions has buoyed global markets. Vinod Nair highlighted the role of FIIs in bolstering this rally, particularly in large caps. The RBI's move included a reduction of the policy repo rate to 5.5%, alongside a phased cut in the CRR.

(With inputs from agencies.)