Markets rebound: Sensex back near 81,000; Nifty steady at 24,836 as RBI calms nerves

By Sarhind Times Business Bureau

Mumbai, October 3:
After two volatile weeks of nervous selling, Dalal Street breathed a sigh of relief on Thursday as the Sensex surged 716 points to close at 80,983, while the Nifty 50 advanced 225 points to 24,836. The rebound came on the back of the Reserve Bank of India’s decision to hold policy rates, while simultaneously revising GDP growth estimates upwards and inflation forecasts downwards, a combination that reassured investors.

The tone of the RBI commentary helped reset risk appetite, encouraging buying across financials, autos, consumption, and select large-cap stocks. Market veterans noted that the “higher-lows” pattern in Nifty remains intact, a technical sign that bulls still control the trend.

📊 RBI’s steady hand: Why investors cheered

The central bank maintained the repo rate at 6.5%, citing stable liquidity conditions and moderating inflationary pressures. More significantly, the RBI’s revised forecast pegged GDP growth slightly higher for FY25, while cutting CPI inflation estimates.

This balancing act gave traders confidence that India’s economy remains resilient amid global uncertainties—ranging from tariff disputes to oil price swings. Analysts described the RBI’s stance as “hawkish on vigilance, dovish on growth”—a dual message that lifted sentiment.

📈 The day’s market action

Sensex: Closed at 80,983 (+716 points).
Nifty 50: Ended at 24,836 (+225 points).
Sectoral gains: Banks, autos, and FMCG led advances.
Volume trends: Analysts reported above-average rollovers into October derivatives, reflecting bullish positioning.
Technical view: Immediate resistance seen at 24,850–24,900; support near 24,600.

According to Rajesh Pal, Senior Technical Analyst at a brokerage,

“As long as Nifty holds above 24,600, the higher-lows formation continues. The zone of 24,850–25,000 remains the big hurdle for the index.”

💹 Global and domestic triggers

Global market jitters—especially around US tariff announcements and crude price swings—had spooked investors earlier in September. Thursday’s action suggested that Indian equities may be decoupling slightly, with domestic liquidity and earnings optimism acting as buffers.

Foreign Portfolio Investors (FPIs), net sellers for much of September, showed early signs of stabilising their flows. Domestic Institutional Investors (DIIs), flush with mutual fund inflows, continued to provide strong counterweight buying.

🚘 Sectoral highlights

Banking & Financials – Private banks led the rally as credit growth continues to outpace concerns over asset quality.
Autos – With festive season demand in sight, auto majors and ancillaries saw healthy buying.
FMCG & Consumption – Discretionary spending trends supported large-cap FMCG names.
IT – Sector remained range-bound, with focus on upcoming US economic data.

🧾 Derivative cues

The derivatives market showed strong rollovers into October, particularly in rate-sensitive stocks. Traders highlighted put-call ratios that suggest confidence in 24,600 as a support level. Gift Nifty signals overnight also pointed to sustained strength.

📑 Broader context: RBI’s role in investor psychology

Markets often hinge less on hard numbers and more on sentiment. The RBI’s ability to present a calm, credible narrative around growth and inflation was key to today’s rally.

Economist Anjali Mehta noted:

“The RBI did not surprise with its decision, but the nuance—acknowledging risks while underlining resilience—was what calmed nerves. That narrative matters as much as rate moves.”

🌏 International lens

US: Treasury yields and Fed signals remain volatile; India’s insulation stems from strong domestic demand.
China: Economic slowdown continues to affect commodity markets, indirectly benefiting India’s import bill.
Oil: Brent crude’s swings between $90–95 remain the biggest wildcard.

⚠️ Risks on the horizon

Despite the optimism, risks remain:

Escalating global tariff tensions.
Any oil spike due to geopolitical flashpoints.
Domestic inflationary surprises in food prices.
Q2 earnings disappointment in banking or IT.

📰 Conclusion

Thursday’s rebound shows that Indian markets are still driven by strong domestic fundamentals and investor liquidity. The RBI’s balancing act reassured participants, and for now, the higher-lows structure in indices supports optimism.

But with global uncertainty still simmering, experts caution that volatility is far from over. For long-term investors, the message is clear—stay invested in quality, avoid chasing speculative moves, and let India’s structural story play out.

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