Sensex Jumps 447 Points, Nifty Gains 153 After RBI’s 25 bps Cut, Markets Cheer Softer Inflation Outlook

Mumbai: Indian equity markets ended the week on a positive note after the Reserve Bank of India (RBI) announced a 25 basis point cut in the repo rate, bringing it down to 5.25 percent. The Monetary Policy Committee, led by Governor Sanjay Malhotra, also maintained a neutral policy stance.

The central bank delivered a double surprise-cutting rates and sharply lowering the FY26 inflation forecast to 2 percent from 2.6 percent, while raising the growth projection to 7.3 percent from 6.8 percent. Analysts said these moves reflect strong confidence in the economy and improving price stability.

Sensex and Nifty Close Higher

Equities reacted positively to the policy announcement.

The Sensex closed at 85,712.37, gaining 447.05 points (0.52 percent), while the Nifty ended at 26,186.45, up 152.7 points (0.59 percent).

Market participants noted that Nifty comfortably held above the crucial psychological level of 26,000.

Analysts said the 26,000–26,100 range remains a strong support zone. For the next upward move, Nifty must close above 26,300, which could open the path to 26,450–26,600.

Sectoral Performance and Key Movers

Most major sectoral indices ended in the green.

Nifty PSU Bank was the standout performer, rising 1.5 percent. Banking, auto, metal, IT, realty, and oil and gas stocks also saw good buying interest.

In contrast, media, pharma, FMCG, and consumer durables closed lower.

On the Sensex, State Bank of India, Bajaj Finserv, Maruti Suzuki, Bajaj Finance, and HCL Tech were among the top gainers.

Major losers included Hindustan Unilever, Eternal, Trent, Sun Pharma, Tata Motors PV, and Bharat Electronics.

Why Markets Reacted Positively

Market experts said the rate cut came as a pleasant surprise because strong Q2 GDP numbers had reduced expectations of any immediate easing.