Sensex jumps over 400 points after RBI cuts repo rate— 10 key highlights from Indian stock market today

A 25-basis-point rate cut by the Reserve Bank of India (RBI) and the central bank's proposal for a ₹1.45 lakh crore liquidity infusion through bond purchases and dollar-rupee swaps boosted domestic market sentiment, helping the benchmarks end with decent gains on Friday, December 5.

Extending gains to the second consecutive session, the Sensex ended the day with a healthy gain of 447 points, or 0.52%, at 85,712.37, while the Nifty 50 settled at 26,186.45, up 153 points, or 0.59%. The BSE Midcap index ended with a modest gain of 0.21% but the Smallcap index fell 0.67%.

Gains in large and mid-caps lifted the overall market capitalisation of BSE-listed firms to nearly ₹471 lakh crore from ₹470 lakh crore in the previous session, making investors richer by about ₹1 lakh crore in a session.

Indian stock market: 10 key highlights from the day

1. What drove the markets higher?

The domestic market ended higher after the RBI announced a 25 bps rate cut. This came as a surprise, as there was a broad consensus that the central bank would hold rates due to record-low inflation and strong economic growth.

Additionally, the upward revision of growth estimates and the lowered inflation forecasts also boosted market sentiment, while the liquidity infusion through OMO purchases also cheered the market.

"Indian markets have enthusiastically responded to the RBI's unexpected 25 bps rate cut, a move that seemed unlikely given the strong Q2 GDP data. This surprise, combined with sharply lower inflation forecasts and supportive liquidity measures, has triggered a risk-on sentiment across equities," Vinod Nair, Head of Research, Geojit Investments, observed.

2. Top gainers in the Nifty 50 index today

As many as 38 stocks ended in the green, among which Shriram Finance (up 3.04%), SBI (up 2.49%), and Bajaj Finserv (up 2.13%) ended as the top gainers.

3. Top losers in the Nifty 50 index

Shares of HUL (down 4.92%, with respect to the issue price), Eternal (down 1.35%), and InterGlobe Aviation (down 1.27%) ended as the top losers in the index.

HUL demerger record date was today (Friday, December 5). From today, Hindustan Unilever (HUL) shares traded ex-ice cream business, which is Kwality Wall’s (India).

4. Sectoral indices: Bank, Financial Services shine

Nifty Bank (up 0.82%) and Financial Services (0.98%) ended with healthy gains after the RBI cut rates by 25 bps. The PSU Bank index jumped 1.51%, while the Private Bank index gained 0.49%. Nifty IT (up 0.90%) and Auto (0.74%) also clocked healthy gains.

5. Most active stocks in terms of volume

Vodafone Idea (98.4 crore shares), Filatex Fashions (28.62 crore shares), and Easy Trip Planners (13.56 crore shares) were the most active stocks in terms of volume on the NSE.

6. Seven stocks jump more than 15% on BSE

Kesoram Industries, Keynote Financial Services, and Rollatainers were among the seven stocks that surged more than 15% on the BSE.

7. Advance-decline ratio

Out of 4,328 stocks traded on the BSE, 1,805 advanced, while 2,342 declined. Some 181 stocks remained unchanged.

8. Over 90 stocks hit 52-week highs

Hero MotoCorp, Aditya Birla Capital, Hindustan Copper, National Aluminium Company, SKF India (Industrial), and SKF India (Industrial) were among the 91 stocks that hit their 52-week highs on the BSE.

9. Over 300 stocks hit 52-week lows

As many as 304 stocks, including UBL, REC, PFC, IREDA, and Thermax, hit their 52-week lows in intraday trade on the BSE.

10. Nifty's technical outlook

According to Sudeep Shah, Head - Technical and Derivatives Research at SBI Securities, the 26,300–26,350 zone, which coincides with the previous swing high, may act as an important resistance zone for the Nifty 50.

"Any sustained move above 26,350 could lead to a fresh leg of rally in the index, potentially taking it higher towards 26,500, followed by 26,700. On the downside, the 20-day EMA zone of 26,000-25,950 is likely to act as a crucial support for the index," said Shah.

Rupak De, Senior Technical Analyst at LKP Securities, finds the trend positive, with the index sustaining above the 21 EMA.

"On the hourly chart, the index has given a breakout from its recent consolidation, indicating rising optimism. The RSI has reclaimed a bullish crossover, pointing towards strong momentum," De observed.

"In the short term, the trend may remain strong, with the potential for the Nifty to move towards 26,300 and 26,440. Support is placed at 26,060–26,000. Buying on dips may be favoured as long as the index sustains above 26,000," De said.

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Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.