Stock Market Today: Indian equity market indices Sensex and Nifty 50 rose for the third consecutive session and ended at fresh closing highs on Friday, June 7, after the Reserve Bank of India kept repo rate and policy stance unchanged and revised up FY25 GDP forecasts.
Also read: RBI Monetary Policy: From Inflation to Growth Outlook – 5 Key Highlights of RBI MPC Outcome
Despite a steep 6% drop on June 4, market indices have been rallying steadily so far in June. The Sensex has risen around 3.7% and the Nifty 50 has risen around 3.4% in the first week of June.
The Sensex index hit an all-time high of 76,795.31 during trading hours before ending at 76,693.36, up 1,619 points or 2.16 percent, with all indices in the positive.
The Nifty 50 closed 469 points or 2.05 per cent higher at 23,290.15, with only two stocks – SBI Life (down 1.03 per cent) and Tata Consumer (down 0.43 per cent) – declining.
The BSE midcap index rose 1.28 per cent while the smallcap index ended with a gain of 2.18 per cent.
The total market capitalization of all companies listed on the BSE is approximately ₹From nearly 42.34 crore. ₹415.9 trillion in the previous session, investors invested around ₹75 lakh per session.
Let’s look at five key factors that likely boosted the stock market.
1. RBI raises growth forecast
The RBI has raised its GDP growth forecast for FY25 to 7.2% from 7% previously. The central bank expects above-normal monsoon and stronger services activity to boost rural and urban consumption and bolster the domestic economy. This appears to have impacted market sentiment.
The RBI has projected real GDP growth at 7.2% for FY25, against 7.3% in Q1, 7.2% in Q2, 7.3% in Q3 and 7.2% in Q4.
Also Read:Also Read:RBI Monetary Policy: Real GDP growth forecast raised to 7.2% from 7% in FY25
2. Expectations for political stability and policy continuity are growing
The BJP-led NDA is set to form a new government, with Narendra Modi taking oath as Prime Minister of India for the third time on Sunday, June 9. All parties in the NDA coalition say they remain firmly united and the government will complete its term smoothly.
Also read: Narendra Modi to take oath as Prime Minister for the third time at 6 pm on June 9: Prahlad Joshi
Moreover, the government is unlikely to compromise on its pro-development policies and experts expect the central government to continue with its policies.
Prime Minister Narendra Modi on Friday said that 10 years of power was “just a trailer” and the Union was ready to work harder and faster for the country’s development in the future, as reported by Mint.
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“Hope of stability in the coalition government at the Centre coupled with the Reserve Bank of India’s upward revision of FY25 growth forecast to 7.2 per cent prompted a broad-based rally in the domestic market. Indian markets surpassed the previous record high recorded on exit poll day to touch a new peak,” said Vinod Nair, head of research at Geojit Financial Services.
(To be continued)
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