7 hrs ago
Sensex, Nifty Fall as RBI Rate Hike Fuels Volatility
India’s stock market ended lower on Wednesday.
The Reserve Bank of India raised the rate it charges banks to borrow money.
The new rate is 5.50%, after a rise of 25 basis points.
When borrowing costs go up, some loans and monthly payments may become more expensive.
Higher oil prices can also add to inflation worries in India.
An expert said these pressures could affect businesses and spending.
Some kinds of shares fell, while some private bank shares held up better.
Investors are watching oil prices, the rupee and the global economy for clues about what markets may do next.
India’s benchmark Sensex and Nifty ended Wednesday’s session lower after a recent market rally.
The Reserve Bank of India raised its repo rate by 25 basis points to 5.50%, its first increase in nearly four years.
The central bank shifted its policy stance to calibrated tightening, signaling a cautious approach to inflation.
Expert Nasser Salim said rising crude oil prices and higher borrowing costs could weigh on earnings, growth, consumption and investment.
Metal, auto, FMCG and IT stocks faced selling pressure, while some private banking stocks showed resilience; the rupee weakened against the US dollar.
- Who
- The Reserve Bank of India raised its repo rate; investors and Indian market participants reacted.
- What
- The Sensex and Nifty ended lower after a 25-basis-point repo-rate increase to 5.50%.
- Where
- India’s financial markets.
- When
- Wednesday’s trading session; the article does not specify a date.
- Why
- Investors were cautious about the rate increase, rising global crude oil prices and their potential effects on inflation, borrowing costs and economic activity.
Key facts
- Repo rate after increase
- 5.50%
- Rate increase
- 25 basis points
- Policy stance
- Calibrated tightening
- Rate-hike context
- The first increase in nearly four years, according to the article.
- Stocks under selling pressure
- Metal, auto, FMCG and IT
- Stocks showing resilience
- Select private banking names
- Other market concern
- The rupee weakened against the US dollar following the policy announcement.
Quotes
Nasser Salim
Managing Director of Flexi Capital
“benchmark indices ended Wednesday's session in the red as investors turned cautious following the Reserve Bank of India's decision to raise the repo rate by 25 basis points amid renewed concerns over rising global crude oil prices.”
timesnownews.com
Sources
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