Market Close Report Today, October 7, 2026: Nifty, Sensex Fall As RBI Turns Hawkish

Mumbai, October 7: Indian equity benchmarks snapped a two-session winning run on Wednesday, ending lower after the Reserve Bank of India raised its policy rate for the first time in nearly four years and shifted its stance to calibrated tightening. The Nifty 50 closed below 22,650, while the Sensex shed 429 points as investors weighed higher borrowing costs against the central bank’s upgraded growth outlook. 

At close, the Sensex was down 429.11 points, or 0.59%, at 72,638.70, while the Nifty declined 173.05 points, or 0.76%, to 22,603.05. About 1,928 shares advanced, 2,251 declined and 192 were unchanged. 

The benchmarks had already been under pressure before the policy decision. GIFT Nifty futures had pointed to a weaker start, while persistent inflationary pressures from elevated crude prices and the prospect of tighter global monetary policy kept investors cautious. The Nifty had closed at 22,776.10 on Tuesday after gaining nearly 1%. 

The RBI’s six-member Monetary Policy Committee unanimously raised the repo rate by 25 basis points to 5.50%, its first increase since February 2023. The central bank also moved its stance from neutral to “calibrated tightening”, citing rising inflation risks from higher oil prices and the global monetary backdrop. 

RBI Raises Growth Forecast 

The rate hike came alongside a stronger growth outlook. The RBI raised its GDP growth forecast for the current financial year to 7.1%, 40 basis points above its previous projection, after the economy expanded 7.8% in the April-June quarter. 

However, inflation has become a growing concern for policymakers. Consumer inflation accelerated to 4.82% in August, remaining above the RBI’s 4% target for a third consecutive month. Governor Sanjay Malhotra said the inflation outlook was “no longer benign”. 

The policy shift nevertheless created a mixed impact across financial stocks. Banks pared their initial losses after the announcement, with analysts pointing to the possibility of improved margins as loan rates reprice faster than deposit costs. The absence of additional liquidity tightening also helped ease concerns over funding costs. 

Titan, Metal Stocks Lead Decline 

Titan Company was the biggest Nifty loser, falling 3.8%, followed by Adani Enterprises, Hindalco Industries, JSW Steel and Bharat Electronics. 

Metal stocks were among the worst performers, with the Nifty Metal index falling 2.3%. The decline tracked weaker global metal prices as a stronger dollar made commodities more expensive for overseas buyers. Titan also came under pressure after analysts flagged weaker-than-expected jewellery growth in the September quarter. 

Among gainers, Kotak Mahindra Bank led the Nifty pack, followed by BSE, Bharti Airtel, ICICI Bank and Coal India. 

Rate-Sensitive Sectors Under Pressure 

Sectoral selling was broad-based, with only the media and PSU Bank indices ending higher. FMCG, IT, auto, metal and realty stocks fell between 1% and 2%. 

The Nifty Auto index declined 1.6%, while FMCG and Realty fell 0.9% and 1.8%, respectively. Fourteen of the 16 major sectoral indices ended lower. 

The broader market was relatively mixed. The Nifty Midcap index declined 0.6%, while the smallcap index gained 0.3%. 

Rupee, Oil Add To Market Concerns 

The policy decision also triggered moves in the currency and bond markets. The rupee weakened to a five-month low against the US dollar, while bond yields rose after the RBI announcement. 

Crude prices remained another source of pressure. Brent rose around 1.3% to $102 a barrel as risks to US oil output from a storm and attacks on Saudi Arabia raised concerns over supply. 

For equities, the RBI’s decision marks a shift in the interest-rate backdrop after a prolonged easing cycle. With inflation pressures building and crude remaining elevated, investors are likely to closely track the pace of further monetary tightening, foreign fund flows and September-quarter earnings for the next market direction. 

Source

• NSE
• BSE