While the markets had factored in a hike, the Monetary Policy Committee’s decision to hit the pause button didn’t trigger any rally on a day the Asian indices traded in the red.
“This is a pause and not a pivot. Undoubtedly, the market’s reaction to the pause was positive as reflected in the 10-year yield that fell 5 bps, and both the Nifty50 and Sensex rose for the fifth day in a row,” said Nilesh Shah, MD and CEO of Kotak MF.
The 30-share Sensex gained 143.66 points, or 0.24%, to close at 59,832.97. It has gained close to 2,220 points, or 3.85%, in the last five sessions, during which investor wealth has increased by Rs 10.43 trillion.
Taher Badshah, CIO of Invesco MF, said: “This appears to be a guarded pause, with a caveat that monetary conditions will likely remain tight. The recent build-up in domestic inflationary pressures and slowing growth indicators are perhaps being viewed by markets as possible concerns.”
Realty was the biggest gainer among sectoral indices, jumping 2.9%. Godrej Properties rallied 6.6%, while DLF and Oberoi Realty surged above 4%. Mahindra Lifespace, Sobha, and Lodha too gained close to 2% each. Market breath was positive, with 2,365 stocks advancing and 1,167 declining.
The Nifty50 rose 42.10 points, or 0.24%, to close at 17,599.15, having risen by 647 points, or 3.85%, in the last five sessions.
The Nifty Realty gained 2.84%, with Godrej Properties jumping over 6%, and DLF and Oberoi Realty gaining 4% each.
“The market is cautious ahead of two key data points from the US — jobs and inflation — expected next week. Therefore, the real impact of the policy on the markets will be visible only then,” said Pankaj Pandey, head of research at ICICI Securities.
He pointed out that with the realty index having shed 14.7% over the last one year against a 1.2% drop in the Nifty, any pause will bring cheer to realty players, who are struggling with sales in the affordable segment.
DIIs remained net sellers, pulling out Rs 997.08 crore, while FIIs continued being net buyers, to the tune of Rs 475.81 crore, according to provisional data from the exchanges. FIIs have pumped in a net Rs 5,058 crore ($615 million) since March 29, while DIIs have infused a net Rs 1,030 crore.
Asia-Pacific peers were down for the day. The Nikkei shed 1.22%, Straits Times Index was down 0.55% and fell Kospi 1.44%. Australia’s ASX200 was down 0.3% while New Zealand’s NZX50 was flat, marginally up 0.03%. The Hang Seng, however, gained 0.28%, while the Shanghai Composite did not see any change.