Overall market breadth was positive as 1,390 shares ended higher.The S-P BSE Sensex and NSE Nifty 50 index gained for fourth day in a row after the Reserve Bank of India kept its key lending rate unchanged at 5.15 per cent in a bid to keep inflation in check which has run up to its highest levels in more than five years, but retained its accommodative monetary policy stance as growth remains lacklustre.
The benchmarks opened higher but turned flat on caution among investors ahead of the monetary policy decision but soon rebounded on the back of buying interest in rate sensitive shares after the policy decision.The Sensex ended 163 points or 0.4 per cent to close at 41,306 and the Nifty 50 index advanced 49 points or 0.4 per cent to close at 12,138.All six members of the Monetary Policy Committee voted in favour of maintaining the status quo on policy.The RBI said the economy continues to be weak and the output gap remains negative, projecting a gross domestic product (GDP) growth rate of 6 per cent for the next financial year starting April 1 and retaining the estimate for the current financial year at 5 per cent.In a bid to increase lending to micro, small and medium enterprises (MSMEs) as well as the auto and home segments segment, the Reserve Bank of India (RBI) on Thursday tweaked maintenance of cash reserve ratio (CRR) norms by providing relaxation in calculation of total deposits.The move will encourage lending towards these targeted sectors having multiplier effect by banks as they will get exemption in CRR over incremental lending.
This exemption window is available till July 2020.Eight of 11 sector gauges compiled by the National Stock Exchange ended higher led by the Nifty PSU Bank index's 2.6 per cent gain.
Rate sensitive financial services, bank and private bank indexes also rose nearly 1 per cent after the central bank tweaked liquidity guidelines.On the other hand, Nifty FMCG index was top loser, down 0.6 per cent.Mid- and small-cap shares also witnessed buying interest as the Nifty Midcap 100 index rose 0.7 per cent and Nifty Smallcap 100 index advanced 0.5 per cent.Eicher Motors was top gainer in the Nifty 50 basket of shares, the stock rose 5.4 per cent to close at Rs 20,530 after the Royal Enfield bike maker said that its profit declined marginally to Rs 489 crore in December quarter.IndusInd Bank, Zee Entertainment, Bajaj Finance, Bharti Airtel, GAIL India, Yes Bank, JSW Steel and Hero MotoCorp were also among the gainers.On the flipside, Tata Motors, Cipla, Titan, Infosys, ITC, Bharat Petroleum and Hindalco were amog the losers.The overall market breadth was positive as 1,390 shares ended higher while 1,056 closed lower on the BSE.