Indian indices fell a per cent on Thursday after the Reserve Bank of India (RBI) kept key policy rates steady with no guidance on a rate cut.

The Sensex slid 724 points, or 1 per cent, to end at 71,428, while the Nifty50 settled at 21,718, down 0.97 per cent. The broader markets performed better, with the NSE Midcap 100 and Nifty Smallcap 100 slipping marginally. Cash market volumes on the NSE rose to ₹1.47 lakh crore.

Top Nifty losers include ITC and Britannia (down 4 per cent each). Lenders Axis Bank, Kotak Mahindra Bank and ICICI Bank were down over 3 per cent each.

Among sectors, the Nifty PSU Bank and Nifty Media indices rose 2 per cent higher, while the Nifty Private Bank index slid 2.5 per cent. FMCG shares got impacted by weak Q3 result and downgrade in volume growth in the near-term due to weak rural demand.

FPIs offload

Foreign portfolio investors (FPIs) offloaded shares worth ₹4,933 crore, while the domestic institutions bought shares worth ₹5,512 crore on Thursday. The long-short ratio fell sharply to 34.3 per cent on February 7 from 37.3 per cent the previous day as FPIs built significant short positions in index futures for the first time since the start of February series.

Inflows into equity funds in India surged to a 22-month high in January, driven by investments into multi- and small-cap schemes as the markets scaled record highs.

Vinod Nair, Head of Research, Geojit Financial Services, said, “Though FY25 GDP growth forecast has improved, the RBI remains vigilant on inflation and banking liquidity. The incomplete transmission of the cumulative 250 bps and the inflation ruling above the target level add uncertainty about the timing of the interest rate reduction.”

Global equities were mixed following the positive close on Wall Street on Wednesday. Among Asian peers, Hang Seng slid the most at 1.3 per cent, while Shanghai Composite gained 1.3 per cent. European indices were trading in the green.

A long negative candle was formed on the daily chart, which indicates an emergence of selling pressure from near the crucial overhead resistance of around 22,000-22,100 levels, according to analysts. “The short-term trend of Nifty seems to have turned down and one may expect some more weakness in the short term. The near-term uptrend of the market remains intact and further weakness down to the immediate support of 21,550-21,500 levels could be a buying opportunity,” said Nagaraj Shetti, Senior Technical Research Analyst, HDFC Securities.