Will Sensex and Nifty Remain Steady Ahead of RBI’s Repo Rate Decision?
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Synopsis
As market players hold their breath for the RBI's repo rate decision, Sensex and Nifty remain steady. What will the central bank's announcement mean for investors? Explore the latest developments and understand the potential market impacts.
Key Takeaways
- RBI’s repo rate decision is anticipated to influence market movements.
- Sensex and Nifty opened flat, reflecting cautious trading.
- Positive trends observed in the IT and PSU bank sectors.
- Support and resistance levels for Nifty identified.
- Market volatility may increase post-RBI announcement.
Mumbai, June 6 (NationPress) The domestic benchmark indices commenced the trading day on a flat note this Friday, as investors eagerly anticipate the crucial RBI monetary policy committee (MPC) decision regarding the repo rate. Early trading showed positive movements in the IT and PSU bank sectors.
The RBI is expected to reduce policy rates by 25 basis points, a change that the stock market has already largely anticipated.
By approximately 9:23 AM, the Sensex was down by 82.43 points or 0.10 percent, trading at 81,359.61, while the Nifty fell by 7.70 points or 0.03 percent, sitting at 24,743.20.
The Nifty Bank index saw a slight increase of 4.85 points or 0.01 percent, reaching 55,765.70. The Nifty Midcap 100 index traded at 58,449.25, gaining 146.25 points or 0.25 percent, while the Nifty Smallcap 100 index rose to 18,498.10, up by 65.50 points or 0.36 percent.
Analysts believe that the RBI's commentary on growth and inflation forecasts for FY26 will be particularly significant.
“Should inflation forecasts be revised down from 4 percent, we could see a positive market reaction,” noted Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments Ltd.
Analysts indicate that the Nifty is likely to find immediate support at 24,500, followed by 24,400 and 24,300. Conversely, resistance is anticipated at 24,850, 24,900, and at the psychological level of 25,000.
“A fall below 24,500 could lead to increased selling pressure, while a breakout above 25,000 might pave the way for new highs,” stated Mandar Bhojane, Equity Research Analyst at Choice Broking.
The India VIX decreased by 4.21 percent to 15.08, indicating that the market is anticipating lower volatility in the near future. However, with the RBI's policy announcement approaching, traders should exercise caution as volatility could rise depending on the central bank's outlook.
In the Sensex pack, the top gainers were Bajaj Finserv, Tata Steel, IndusInd Bank, Eternal, ITC, NTPC, and Titan. On the other hand, the biggest losers included Tata Motors, Bajaj Finance, ICICI Bank, HDFC Bank, and SBI.
In Asian markets, Hong Kong, China, and Bangkok were trading in negative territory, while only Japan was in the green.
In the previous trading session, the Dow Jones in the US closed at 42,319.74, down 108 points or 0.25 percent. The S&P 500 ended with a decline of 31.51 points or 0.53 percent at 5,939.30, while the Nasdaq closed at 19,298.45, down 162.04 points or 0.83 percent.
Regarding institutional activity, foreign institutional investors (FIIs) were net sellers, divesting equities worth Rs 208.47 crore on June 5. In contrast, domestic institutional investors (DIIs) remained robust buyers with net purchases totaling Rs 2,382.40 crore, providing essential support to the market.
Point of View
We remain committed to delivering unbiased news that empowers our readers. Today's market movements reflect investor caution as they await vital decisions from the RBI. Our priority is to provide trustworthy insights, ensuring our audience remains informed in these dynamic times.
NationPress
07/06/2025
Frequently Asked Questions
What is the significance of the RBI's repo rate decision?
The RBI's repo rate decision is crucial as it influences borrowing costs and economic growth, impacting investor sentiment in the stock market.
How are the indices performing today?
As of now, Sensex is down by 82.43 points, and Nifty has declined by 7.70 points, reflecting cautious trading ahead of the RBI's announcement.
Which sectors are showing strength in early trade?
Early trading has shown positive movements in the IT and PSU bank sectors, suggesting investor interest in these areas.
What are analysts predicting for Nifty's support and resistance levels?
Analysts suggest immediate support for Nifty at 24,500 and resistance at 24,850, with significant movements expected around these levels.
What was the activity of FIIs and DIIs recently?
Recently, foreign institutional investors were net sellers, while domestic institutional investors showed strong buying activity, providing market support.
