The key equity benchmarks traded with substantial gains in the early afternoon trade after the Reserve Bank of India’s (RBI) monetary policy committee (MPC) left the repo rate unchanged. The Nifty traded above 24,750 mark.
PSU bank shares declined after advancing in the past three consecutive trading sessions.
At 12:25 IST, the barometer index, the S&P BSE Sensex advanced 550.53 points or 0.69% to 80,823.81. The Nifty 50 index added 161.50 points or 0.66% to 24,772.60.
In the broader market, the S&P BSE Mid-Cap index rose 0.32% and the S&P BSE Small-Cap index declined 0.44%.
The market breadth was positive. On the BSE, 2,430 shares rose and 1,466 shares fell. A total of 182 shares were unchanged.
Derivatives:
The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, rose 1.18% to 11.50. The Nifty 30 September 2025 futures were trading at 24,919.90 at a premium of 147.3 points as compared with the spot at 24,772.60.
The Nifty option chain for the 28 October 2025 expiry showed a maximum call OI of 41.1 lakh contracts at the 25,500 strike price. Maximum put OI of 36.8 lakh contracts was seen at the 24,000 strike price.
Economy:
The Reserve Bank of India’s Monetary Policy Committee (MPC) kept the policy repo rate unchanged at 5.5% in its review that concluded on 1 October 2025.
The committee maintained a neutral stance, noting that it was prudent to wait for the impact of past policy measures and for greater clarity on global developments before making further moves. The standing deposit facility (SDF) rate stays at 5.25%, while the marginal standing facility (MSF) rate and the Bank Rate remain at 5.75%.
The RBI noted that the global economy has been stronger than expected in 2025, supported by robust growth in the US and China, though elevated policy uncertainty, sticky inflation in some advanced economies, and volatile financial markets pose risks. In India, GDP expanded 7.8% in Q1 FY26 on the back of resilient consumption and investment, a revival in manufacturing, and steady services growth. Rural demand was buoyed by a good monsoon, while urban demand showed signs of recovery. Looking ahead, healthy agriculture prospects, rising capacity utilisation, GST rationalisation, and supportive financial conditions are expected to aid growth, though global trade and geopolitical risks remain a drag.
The central bank raised its real GDP growth forecast for FY26 to 6.8% from 6.5% earlier, projecting growth at 7% in Q2, 6.4% in Q3, and 6.2% in Q4. For Q1 FY27, growth is expected at 6.4%.
On inflation, the RBI cut its CPI forecast for FY26 to 2.6% from 3.1%, with projections of 1.8% in Q2 and Q3, 4% in Q4, and 4.5% in Q1 FY27. Inflation is seen staying contained, though tariff-related developments could weigh on the growth outlook in the second half.
The minutes of the meeting will be published on 15 October, and the next MPC meeting is scheduled for 3-5 December 2025.
Buzzing Index:
The Nifty PSU bank index declined 1.05% to 7,448.05. The index jumped 3.65% in the past three consecutive trading sessions.
Indian Bank (down 2.46%), Canara Bank (down 1.92%), Union Bank of India (down 1.52%), Bank of Baroda (down 1.12%) and Punjab National Bank (down 1.1%) were the top losers. Among the other losers were State Bank of India (down 0.82%), Indian Overseas Bank (down 0.66%), Bank of Maharashtra (down 0.48%), Punjab & Sind Bank (down 0.44%) and UCO Bank (down 0.43%)declined.