Domestic markets, Sensex and Nifty, ended marginally lower on Friday, led by profit-booking in banking stocks after the Reserve Bank of India’s monetary policy announcements.
The S&P BSE Sensex ended 132.38 points or 0.25 per cent lower at 52,100.05, with Nestle being the top laggard, dropping 2 per cent followed.
Similarly, NSE Nifty slipped 20.10 points or 0.13 per cent to 15,670.25.
Apart from Nestle, other laggards on the Sensex pack included SBI, HDFC Bank, Axis Bank, ICICI Bank, Reliance Industries, HUL and Dr Reddy’s. On the other hand, Bajaj Finserv, ONGC, L&T, Bajaj Finance and HDFC were among the gainers.
According to Binod Modi, Head – Strategy at Reliance Securities, benchmarks corrected marginally led by a contraction in financials, especially in banks.
“A moderate increase in inflation forecast by the RBI in its policy meeting outcome led G-sec yields increasing by 3 bps, which resulted in profit-booking in banks,” he noted.
Earlier in the day, RBI left the key interest rates unchanged at record lows as it reiterated its commitment to keep its monetary policy accommodative to help the economy recover from the world’s worst outbreak of COVID-19 infections.
It also lowered its forecast for the country’s economic growth to 9.5 per cent for the current financial year ending March 31, 2022, from the previous estimate of 10.5 per cent.
“MPC meeting outcome today was mostly in-line with expectations as RBI, in addition to maintaining status quo about policy rates, focused upon ensuring sufficient liquidity in the system and supported MSMEs and corporate hit in the second wave.
“An improved prospect of economic recovery led by a sharp drop in daily caseload, ramping up vaccination process and gradual withdrawal of restrictions imposed by states has already led markets to witness fresh high in this week,” he said.
Barring metals and realty, most key sectoral indices traded in red today. However, midcap and smallcap stocks continued to outperform, led by improved earnings visibility.
Weak global cues also weighed on sentiments.