1-MIN READ

Sensex, Nifty rise on hopes of RBI support to flagging economy

Sensex, Nifty rise on hopes of RBI support to flagging economy

Indian shares rose on Thursday, spurred by optimism that the country's central bank will unveil more measures to support a coronavirushit economy during its monetary policy announcement later in the day.

BENGALURU Indian shares rose on Thursday, spurred by optimism that the country’s central bank will unveil more measures to support a coronavirus-hit economy during its monetary policy announcement later in the day.

All major sectoral indexes except autos were trading higher ahead of Reserve Bank of India (RBI) Governor Shaktikanta Das’s policy address, set to begin at noon (0630 GMT).

Around two-thirds of economists polled by Reuters expect the RBI to cut the repo rate, the rate at which it lends overnight funds to banks, by another 25 basis points despite rising inflation.

“Any measures to support the economy or certain stressed out sectors are expected,” said Mayuresh Joshi, head of equity research for India at William O’Neil in Mumbai, adding it could include a one-time restructuring of loans for banks saddled with bad debt.

“Even if a rate cut doesn’t happen because the liquidity is still very, very strong in the system, the governor’s comments will be closely watched,” he said.

Investors will also see if the RBI extends a moratorium on loan repayments to banks, which analysts have said could worsen asset quality of lenders. The Nifty banking index was last up 0.6%.

The NSE Nifty 50 index climbed 0.73% to 11,182.35 by 0500 GMT and the S&P BSE Sensex was 0.70% higher at 37,925.70.

The Nifty realty and IT indexes were up about 1.5% each and were the leading sectoral gainers.

Autos fell 0.47% after a 1.5% gain on Wednesday.

Meanwhile, other Asian stocks also rose, following Wall Street’s lead, after markets took patchy U.S. economic data as a sign that more stimulus was on the cards.

Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

  • Tags:
  • First Published: August 6, 2020, 1:49 PM IST
Next Story
Loading