Sensex sheds 115 points as investors turn wary after RBI policy statement

Our BureauAgencies Updated - December 07, 2021 at 02:34 AM.

sensex

The Sensex and the Nifty fell nearly 0.4 per cent, snapping their four-session winning streak, with oil & gas and consumer durables stocks leading the decline as investors turned cautious after the central bank left the key rates unchanged.

As was widely expected, the Reserve Bank of India has kept its policy rate unchanged at 7.25 percent, while leaving the door open to ease further depending on the inflation outlook and how swiftly banks lower their lending rates.

The central bank said government economic reforms and the timing of any increase in US interest rates would be key factors that will determine whether it cuts rates for a fourth time this year.

"According to me, they are going too cautiously. The RBI is driven by data and not other factors, which suggest that the economy could possibly go into the fast track if they bring down the rate of interest," said Deven Choksey, managing director, KR Choksey Securities.

Most traders said there is scope for at least another 25 basis point cut in the 2015 calendar year, with the trajectory of oil prices, progress of the monsoon and any interest rate hike by the US Fed acting as triggers.

The 30-share BSE index Sensex ended lower by 115.13 points or 0.41 per cent at 28,071.93 and the 50-share NSE index Nifty ended down by 26.15 points or 0.31 per cent at 8,516.90.

Among BSE sectoral indices, consumer durables index fell the most by 0.77 per cent, followed by oil & gas 0.69 per cent, TECk 0.65 per cent and IT 0.59 per cent. On the other hand, metal index was the star-performer and was up 2.69 per cent, followed by PSU 1.03 per cent, auto 1.00 per cent and banking 0.47 per cent.

Oil refiners declined after global prices plunged on Monday as worries of oversupply and a weakening economic outlook, especially in Asia, prompted analysts to warn of further falls.

Top five Sensex gainers were Tata Steel (+3.39%), Hindalco (+3.36%), Coal India (+2.82%), SBIN (+2.54%) and M&M (+2.18%), while the major losers were Hero MotoCorp (-2.73%), GAIL (-2.53%), ONGC (-2.4%), Wipro (-2.16%) and Tata Motors (-1.85%).

European stock markets lost ground on Tuesday, with French bank Credit Agricole and German carmaker BMW among the worst performers after reporting results, while weak oil prices also weighed on energy stocks.

The pan-European FTSEurofirst 300 index, which had risen 0.7 per cent on Monday, edged back by 0.3 per cent, while the euro zone’s blue-chip Euro STOXX 50 index also weakened by 0.5 per cent.

Asian shares struggled to stay positive on Tuesday after downbeat economic data pressured Wall Street ahead of a key US jobs report that could provide important clues to the timing of the Federal Reserve’s interest rate increase.

MSCI’s broadest index of Asia-Pacific shares outside Japan was slightly lower, while Japan’s Nikkei stock index slipped 0.1 per cent, after breaking a three-day winning streak in the previous session.

Published on August 4, 2015 04:35