Indian stock markets had a tough day on Friday after going up for five days in a row. The Reserve Bank of India (RBI) made a big move by cutting the cash reserve ratio (CRR) by 0.50% to help banks lend more money. However, they decided to keep interest rates the same and lowered the growth forecast for the economy.
The S&P BSE Sensex, which is a key stock index, fell by 56.74 points, closing at 81,709.12. Similarly, the Nifty 50 index closed lower by 30.60 points at 24,677.80. Despite the drop, some sectors like auto and finance saw positive gains. For example, Tata Motors shares rose by 3.2%, and Bajaj Auto went up by 2.3%. Axis Bank and Maruti Suzuki also did well.
The RBI kept the main interest rate unchanged for the 11th time. They now expect the economy to grow by only 6.6% this year, down from the previous estimate of 7.2%. The RBI’s decision to lower the cash reserve ratio will free up ₹1.16 lakh crore (a huge amount of money) for banks to lend, hoping to boost the economy.
Vinod Nair, who watches the stock market at Geojit Financial Services, said that even though stocks didn’t move much overall, this was a positive sign. The RBI is trying to help the economy grow despite inflation challenges. The markets were a bit mixed, showing that investors are playing cautiously but still looking for good opportunities.
Global Markets Update
Worldwide, markets were watching the U.S. payroll data to see if the Federal Reserve might cut interest rates soon. In Asia, stocks outside Japan got a boost, mainly due to good news from China. However, stocks in South Korea dropped because of political issues.
Forex Market
The Indian rupee gained strength on Friday, reaching 84.6875 against the U.S. dollar. The dollar was a bit weaker after the RBI’s decisions.
Oil Prices
Oil prices fell on Friday because OPEC+ postponed increasing oil output, raising worries about demand. Brent crude is now priced at $71.71, and West Texas Intermediate is at $67.97.
On December 5, foreign investors bought Indian stocks worth ₹8,539.91 crore while domestic investors sold stocks worth ₹2,303 crore.
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