RBI fires up bulls: Nifty tops 24,800 while Sensex breaks 8-day losing streak, Bank Nifty soars

Nifty, Sensex snap 8-session losing streak.

The Reserve Bank of India fired up the bulls on Dalal Street, leading the Nifty and Sensex to decisively snap their eight-session losing streak on Wednesday, October 1. Banking and financial stocks led the gains, with the Bank Nifty and FinNifty indices rallying over a percent each.

At 11:57 a.m., the Sensex was up 649.18 points or 0.81 percent at 80,916.80, and the Nifty was up 181.65 points or 0.74 percent at 24,792.75. About 2167 shares advanced, 1358 shares declined, and 131 shares unchanged.

In the Monetary Policy Committee meeting today, the RBI decided to keep the benchmark repo rate unchanged at 5.5 percent on October 1, second time in a row. The MPC also kept the stance unchanged to 'Neutral'.

However, the RBI revised its GDP growth estimate for current fiscal year from 6.5 to 6.8 percent, and revised down its CPI inflation forecast from 3.1 to 2.6 for the current fiscal year.

While the Reserve Bank of India’s monetary policy committee’s decision on the benchmark lending rate was along expected lines, the Governor Sanjay Malhotra announced some key measures that could lend support to the ailing domestic equity markets.

Indian markets saw mixed movement across sectors on Wednesday. Nifty Media led the gains, surging 2.5 percent, followed by Pharma up nearly 1 percent and Realty higher by 0.8 percent. Auto and Energy also traded in the green. On the flip side, PSU Banks slipped almost 0.9 percent, while Metals were down 0.5 percent. FMCG and Infra were largely flat, while IT showed marginal gains after recent weakness.

On the technical front, experts believe that the intraday market texture is non-directional; perhaps traders are waiting for an either-side breakout. "On the higher side, 24,800/80800 would act as an immediate breakout zone for the bulls. Above this, the pullback move could continue till 24,900-24,950/81000-81300. On the flip side, below 24,550/80000, selling pressure is likely to accelerate. Below this level, the market could slip to 24,450-24,400/79800-79500," Shrikant Chouhan, Head Equity Research, Kotak Securities said.

The weakness and drift in the market continue led by the sustained selling by FIIs. The near-term may turn out to be frustrating for investors. Experience tells us that such frustrating times are ideal for long-term investment. Systematic investment in high quality largecaps should be the strategy now and patience will be the key to long-term wealth creation, added VK Vijayakumar, Chief Investment Strategist, Geojit Investments.

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