Interest rate-sensitive stocks gain sharply as RBI maintains status quo

Interest rate- sensitive stocks: After the RBI maintained status quo on key policy rate and unanimously changed the stance to 'neutral', interest-rate sensitive stocks strengthened further.  Nifty Bank which was at one point up marginally traded with gains of nearly 1 per cent or 430 points, led by gains in ICICI Bank, State Bank of India and Axis Bank among others.

Interest-rate sensitive sectors tend to get impacted on account of key changes in the policy rate as it results in a direct bearing on the companies' borrowing cash, profits as well as future cash flows. 

Also, rate hikes or decline impact the supply of bank credit to different sectors of the economy. Typically, rate hikes reduce or restrict the credit flow, while rate easing can enhance it.

From the banking pack, Nifty Private Bank index which was down by a tad was also up after the RBI policy announcement.

Nifty Financial Services also geared up in the green and last traded 0.8 per cent, with all financial stocks trading in the green, barring the HDFC Bank.

Meanwhile, the realty stocks were the most robust, with Nifty Realty jumping over 2 per cent.  From the realty pack, all but 2 stocks traded in the green, with most gains of 5 per cent in Phoenix, followed by over 4 per cent gains on Macrotech Developers.

Dharmendra Raichura – VP & Head of Finance at Ashar Group said "as real estate developers, we recognize the importance of a consistent repo rate, as it directly influences borrowing costs and impacts the property sector. This steady rate cultivates a favorable environment for sustainable growth and development within real estate, driving sectoral stability."