Indian Stock Market Declines Ahead Of RBI’s MPC Decision

On Thursday, the Indian stock market closed in the red as investors adopted a cautious approach ahead of the RBI’s Monetary Policy Committee (MPC) rate cut decision scheduled for 7 February.

The Sensex dropped by 213.12 points, or 0.27%, closing at 78,058.16. Throughout the day, the index fluctuated between a high of 78,551.66 and a low of 77,843.99.

Similarly, the Nifty ended lower by 92.95 points, or 0.39%, closing at 23,603.35. The index recorded a high of 23,773.55 and a low of 23,556.25 during the session.

Of the Nifty stocks, 30 companies ended in negative territory. Trent, Bharat Electronics, Bharti Airtel, ONGC, and Titan were among the biggest losers. These stocks saw declines of up to 8.39%.

However, Adani Ports, Cipla, Infosys, and Dr. Reddy’s Labs managed to post gains, rising up to 2.51% during intra-day trade.

The broader market also experienced losses, with the Nifty Midcap100 falling by 1.26% and the Nifty Smallcap100 declining by 0.30%.

Sectoral indices saw mixed performance. The Nifty Auto, FMCG, Consumer Durables, Realty, and Financial Services sectors faced losses, declining by up to 2.19%. In contrast, sectors such as Nifty Bank, IT, Pharma, Private Bank, and Healthcare displayed resilience, closing with modest gains of up to 0.64%.

Dr. Joseph Thomas, Head of Research at Emkay Wealth Management stated, “Around the current levels, that is, 87.30/40, the depreciation in rupee evens out with the level of depreciation in the emerging market currencies and the Latin American and African currencies.”

He mentioned that we should not ignore the possibility of substantial dollar inflows into India. This could be driven by repatriation from companies, especially tech firms, which might be receiving payments from their international businesses.

Gold prices remained largely stable with a slight dip, trading near Rs 84,450 on the MCX, while Comex gold experienced a modest pullback, moving towards $2,850.

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