August 5: Indian benchmark equity indices traded higher on Wednesday after the Reserve Bank of India (RBI) kept the benchmark repo rate unchanged at 5.25%, boosting investor confidence. Positive global market cues and gains in realty and auto stocks further supported the market rally.
At around 11:00 AM, the BSE Sensex climbed 448.91 points (0.57%) to 78,877.87, while the NSE Nifty 50 gained 34.95 points, trading above the 24,600 mark.
The RBI’s Monetary Policy Committee (MPC) maintained its policy stance, choosing to wait for clearer signs on inflation before making any changes to interest rates. The central bank is closely monitoring the impact of elevated crude oil prices and below-normal monsoon conditions on inflation while maintaining confidence in India’s economic growth outlook.
Market sentiment remained upbeat as investors welcomed the policy stability, with analysts viewing the RBI’s decision as a balanced approach that supports economic growth while keeping inflation risks in check. The central bank also highlighted strong macroeconomic fundamentals and resilient domestic demand as key positives for the economy.
Sector-wise, realty and automobile stocks led the gains, while broader markets outperformed the benchmark indices. Mid-cap and small-cap indices continued their upward momentum, touching fresh record highs, reflecting sustained investor interest beyond large-cap stocks. However, banking and financial shares traded largely flat following the policy announcement.
Global market optimism also contributed to the rally, with easing concerns over crude oil prices and supportive international cues encouraging investors to increase exposure to equities. The RBI’s decision to maintain rates, along with its neutral policy stance, reassured markets that policymakers remain focused on balancing inflation control with economic growth.
Key Highlights
- Sensex: 78,877.87, up 448.91 points (0.57%)
- Nifty 50: Above 24,600, up 34.95 points
- Repo Rate: Unchanged at 5.25%
- Top Drivers: RBI policy pause, positive global cues, gains in realty and auto stocks
- Market Outlook: Investors will now closely monitor inflation trends, crude oil prices, monsoon progress, and upcoming corporate earnings for further market direction.
