Except bank and FMCG, all other sectoral indices ended higher. BSE Midcap and Smallcap indices rose over 0.5 percent each.
Vishal Wagh, Research Head, Bonanza Portfolio
On Friday Indian equity benchmarks made a cautious start and are managing to trade above their neutral lines as traders remained on the sidelines ahead of the RBI's monetary policy outcome to be announced later in the day. But, soon markets lost their ground and slipped into red territory. In the afternoon session, Indian equity benchmarks continued their weak trade.
Chief Economic Advisor KV Subramanian has said the second wave of COVID-19 has affected the momentum of economic recovery. However, he also pointed out that he expects a recovery in the economy from July onwards.
Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments
The index has closed a few points below 15700 but the trend still remains positive and we should head to 15900-16000. The Nifty has multiple supports at 15600, 15400 and 15300. The most crucial of these is the 15300 level which needs to be respected on a closing basis. Intraday dips should be utilized to accumulate buy positions on the index for higher targets.
Poonam Tandon, CIO, IndiaFirst Life Insurance Company:
The RBI policy was largely on expected lines from the macro-economic perspective – maintained status quo on policy rates and keeping accommodative stance. CPI inflation is expected to remain in check for 1HFY22 largely due to the base effect. However, rising input prices could see inflation inching upwards in coming quarters.
GDP forecast has also been cut to 9.5% in FY22 versus 10.5% earlier factoring in the impact of the second wave. The central bank will continue with its proactive and pre-emptive approach to ensure the economy returns to growth and keeping ample liquidity to support growth – the focus is now shifting to equitable distribution of liquidity in the real economy.
Other measures include an on-tap liquidity facility of Rs 150 bn at repo rate for stressed sectors, allowing banks to park surplus liquidity with RBI at 40bp higher than the existing reverse repo rate, extending the eligibility restructuring limits for MSMEs from Rs 25 crore to Rs 50 crore and liquidity worth Rs 160 bn to SIDBI for on lending. GSAP 2.0 announced at 1.2 lakh crore in Q2, which is higher than G-SAP 1.0 and also includes State Development Loans (thus compressing the spreads of SDLs). Overall, RBI remains committed to growth and ensuring adequate liquidity in the system.
Indian rupee ended lower at 73 per dollar, amid selling saw in the domestic equity market after RBI kept the key rates unchanged.
It opened lower at 73.02 per dollar against Thursday’s close of 72.91 and traded in the range of 72.95-73.12.
Rupee traded in a narrow range of 72.95-73.05 as the broad market kept muted sessions in dollar index as well as financial market globally. The dollar index can take direction from US Non-farm payroll & Unemployment data later in the evening, which will guide the USDINR further next week. The range for rupee can be seen between 72.75-73.45.
As markets warmed up to Biden’s Tax proposal amidst encouraging payroll data, all eyes were set on the RBI Policy today morning which as expected held status quo and maintained its accommodative stance. The Sensex however flirted around the 52K mark even as the broader market witnessed selective buying interest in Unlock Themes with several states beginning to ease restrictions. Housing & Micro Finance entities were seen buzzing around amidst hectic activity in today's trade.
Benchmark indices ended marginally lower on June 4 after Reserve Bank of India maintained status quo and keep its stance accommodative.
At close, the Sensex was down 132.38 points or 0.25% at 52,100.05, and the Nifty was down 20.10 points or 0.13% at 15,670.30. About 1832 shares have advanced, 1279 shares declined, and 138 shares are unchanged.
Nestle, HDFC Bank, SBI, Axis Bank and ICICI Bank were among the major losers on the Nifty, while gainers included Tata Motors, Grasim Industries, Bajaj Finserv, Coal India and ONGC.
Except bank and FMCG, all other sectoral indices ended higher. BSE Midcap and Smallcap indices rose over 0.5 percent each.
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