The benchmark Nifty50 slipped into a tighter 169‑point band after the RBI disclosed a 25‑basis‑point hike to 5.5%, marking its first rate increase since February 2023.
Trading opened lower, but the index held steady at about 22,600, closing 173 points shy of the previous close—a 0.75% slide that eclipsed the sector’s 0.3% average.
The rate hike was expected, but the shift to a “Calibrated Tightening” stance surprised traders, a move highlighted by RBI Governor Shaktikanta Das in the policy statement.
Sectoral dynamics mirrored the sentiment: IT, metal, and realty indices fell 0.4%, 0.5%, and 0.7% respectively, while PSU banks rallied 0.2% on a demand‑supply narrative. The rupee weakened 0.4% to ₹96.7, and the 10‑year government bond yield hovered at 7.27%, near the 7.5% threshold.
Market participants now focus on key levels: 22,400 support and 22,800 resistance, with any breach potentially triggering a slide to 22,200 or a rally to 23,100.
Looking ahead, traders eye the upcoming GST council meeting and the next earnings cycle, while analysts predict cumulative RBI hikes of 100 basis points over the cycle, keeping bond yields elevated and market volatility on tap.