The benchmark S&P BSE Sensex declined 56.74 points or 0.07% to settle at 81,709.12, while the broader Nifty 50 index closed at 24,677.80, lower by 30.60 points or 0.12%.
In a session where the market faced bouts of volatility, interest rate-sensitive sectors like auto and financials rallied. The auto sector was the top gainer on both the indices, after an earlier rally in the financial sector fizzled out.
Tata Motors shares closed 3.2% higher and shares of Bajaj Auto rallied 2.3%. Meanwhile, Axis Bank and Maruti Suzuki were among the top five Nifty 50 gainers.
The Reserve Bank of India on Friday decided to keep the policy rate unchanged for the 11th time in a row but sharply lowered the GDP growth forecast to 6.6% for the current fiscal, from the earlier level of 7.2%.
The central bank cut the cash reserve ratio (CRR) by 50 basis points to 4%, in an attempt to make available more money with banks for lending so as to boost economic activity. The move by RBI’s rate-setting panel MPC would release primary liquidity of about Rs 1.16 lakh crore to the banking system.Expert View
Commenting on the day’s action, Vinod Nair, Head of Research at Geojit Financial Services said that even though the benchmark indices concluded on a flattish trend, Indian broader indices displayed optimism as the RBI acknowledged the downward growth trend while last-mile inflation persisted.
“By lowering the CRR and injecting Rs 1.16 lakh crore into the financial system, the RBI aims to stimulate economic growth amid increased liquidity. The overall market exhibited a mixed outlook, reflecting a cautious yet resilient stance, with sector rotation and specific stock movements shaping market sentiment,” added Nair.
