India's capital market barometer, S&P BSE Sensex, on Tuesday crossed the psychological mark of 27,000 for the first-time in 2016 following the Reserve Bank of India (RBI) announcing its second bi-monthly policy review for FY 2017. A boost of 232 points (0.87 percent), it seemed, gave a stamp of approval to the RBI's dovish stance to maintain status quo in country's money flow.
The National Stock Exchange's (NSE) Nifty 50 index ended the day at 8,266 points, up 65 points (0.8 percent) over Monday's closing.
The top gainers amongst the banks were State Bank of India, ICICI Bank and Axis Bank; other top gainers include Tata Motors, Sun Pharma, and L&T. Top losers include BPCL, Indus Industrial Bank, Tata Powers and Infosys.
Raghuram Rajan, presenting the penultimate policy review of his current RBI tenure, maintained the repo rate at 6.5 percent in line with many analysts' and experts' expectations. The retail inflation in the country had recently touched 5.39 percent above RBI's stated 5 percent benchmark for healthy growth in economic activities of the country.
Saravana Kumar, chief investment officer at LIC Mutual Fund, noted in statement that the RBI would adopt a wait-and-watch approach in the coming months to see if "data sharply reverses the inflation trajectory." Further monetary easing will depend on inflation undershooting the RBI's 5 percent trajectory, he said.
"It appears that the uncertainties on the global horizon with Fed policy overhang and the Brexit vote tipped the RBI's decision in favour of a status quo," said Rana Kapoor, managing director and chairman of Yes Bank.
The Sensex ranged from a high of 27,082 points to a low of 26,829 points during the trading session on Tuesday.
