Rate-sensitive stocks rise ahead of RBI policy decision
New Delhi: Shares of interest rate-sensitive stocks like auto, banking and realty rallied in morning trade on the bourses ahead of the Reserve Bank of India's monetary policy decision today.
The Monetary Policy Committee (MPC), headed by RBI Governor Urjit Patel, will announce the resolution of the MPC on its first bi-monthly monetary policy for financial year 2018-19 later in the day.
Among banking stocks, Kotak Mahindra Bank rose as much as 1.91 per cent, while Yes Bank jumped 2.40 per cent, State Bank of India 2.06 per cent, Federal Bank 2.07 per cent, Punjab National Bank 1.85 per cent and Bank of Baroda 2.60 per cent.
The BSE bank index rose 1.75 per cent to a high of 27417.10 points.
The outcome of the MPC meeting is being keenly awaited by stakeholders amidst pressure on RBI to cut interest rates in the wake of declining retail inflation and the need to fuel growth momentum.
In the realty segment, Godrej Properties gained as much as 1.81 per cent, Prestige Estates Projects 3.71 per cent, Oberoi Realty 2.69 per cent.
The BSE realty index jumped to 2.55, up 2281.32 per cent.
In the auto pack, Mahindra & Mahindra advanced by 2.63 per cent, Tata Motors 3.23 per cent and Bajaj Auto 1.88 per cent.
The BSE auto index jumped by 1.80 per cent to 25,333.39 points.
Experts believe the central bank will have to do a tightrope walk as globally interest rates are inching upwards.
Last month, the US Federal Reserve raised interest rates by a quarter of a percentage point and signalled that it is on track to raising rates two more times in 2018.