Sensex & Nifty Ready to Soar as RBI Policy Sparks Investor Optimism

Indian stock markets are set for a buoyant start on Friday, with investor focus squarely on the Reserve Bank of India’s (RBI) highly anticipated policy announcement. Hopes for a rate cut and a pro-growth stance are fueling optimism across sectors, especially those sensitive to interest rates.

 

Key Highlights:

 

Bullish Opening Expected:

GIFT Nifty futures were trading at 24,842 early Friday, indicating the Nifty 50 will open above Thursday’s close of 24,750.90. Both Nifty and Sensex gained around 0.5% in the previous session, led by real estate and finance stocks.

 

RBI Rate Cut Anticipated:

The RBI is widely expected to announce a 25 basis point cut to its primary rates at 10:00 a.m. IST, marking the third consecutive reduction this year. Some analysts even predict a possible 50 bps “jumbo” cut, though consensus remains for a 25 bps move.

 

Focus on Growth and Liquidity:

Investors are looking for a stronger emphasis on growth from the RBI to stimulate consumption and support local enterprises. An accommodative policy stance is expected, signaling more liquidity and a pro-growth orientation.

 

Sectoral Momentum:

Rate-sensitive sectors like real estate, banks, and autos are in the spotlight. The Nifty Realty Index has surged 5% this week on policy optimism, while financials and small/mid-cap stocks have also advanced.

 

Macroeconomic Context:

India’s Q4 GDP growth stood at 7.4%, in line with expectations, but gross value added was 6.8%, suggesting a nuanced economic landscape. The benchmarks remain about 6% below their all-time highs from September 2024.

 

Global Backdrop:

Asian markets opened flat, while US indices dipped overnight due to high-profile political tensions, but domestic sentiment remains upbeat ahead of the RBI decision.

 

The market’s next move will hinge on the RBI’s policy tone and the size of the rate cut, with investors hoping for signals that support sustained economic momentum.

 

Source: The Hindu Business Line, Reuters, Moneycontrol, Economic Times, Business Today, Trade Brains, CNBC TV18