It’s celebration time across Dalal Street today. The markets have seen a sharp rally after the announcement of the US-Iran ceasefire for 2 weeks. Adding to the momentum, the RBI has kept interest rates on hold for now and Governor indicated that it possible that rates may remain low over the medium-term. Not surprisingly, rate-sensitive stocks like auto, banking, and real estate were among the top gainers n trade today.
Although, the RBI decision to stay on hold was widely expected, it brought a sense of relief among investors.
Banking stocks lead the charge
Banking stocks were among the biggest beneficiaries after the Policy announcement.
In the intraday trading session, the Nifty Bank index surged around 5%. Both private and public sector lenders are seeing sharp gains.
In the list of banking stocks, heavyweights like HDFC Bank and ICICI Bank rose around 4.5-5%, Similarly, State Bank of India and Kotak Mahindra Bank added over 3%.
Among the top performers, Axis Bank climbed over 6%. Furthermore, PSU banks like Union Bank of India surged more than 8%. Canara Bank and Bank of Baroda gained around 6%.
Additionally, mid-sized banks also joined the rally. AU Small Finance Bank jumped over 8% and IDFC First Bank surged above 6% in the intraday trading session.
Auto stocks accelerate sharply
Auto stocks also saw a strong upmove following the RBI’s rate decision.
With all 15 stocks in the index trading in the green, the Nifty Auto index jumped nearly 7% in the intraday trading sesssion
In the list of auto sector stocks, Ashok Leyland led the rally with a sharp rise of nearly 13%. Motherson gained over 9%.
Maruti Suzuki India, M&M, TVS Motor Company, and Eicher Motors all advanced around 7% in the intraday trading.
Other stocks like UNO Minda and Bharat Forge rose close to 7%. Bosch and Exide Industries added around 6%. Hero MotoCorp and Tube Investments gained over 5%, while Bajaj Auto saw a relatively modest rise of nearly 4%.
Realty stocks mirror the trend
Real estate stocks also moved higher. The Nifty Realty index jumping around 7% in intraday trade.
This sector also tends to benefit directly from stable or lower interest rates, as home loans become more affordable.
Prestige Estates Projects led the gains with a jump of over 8%.
Other stocks such as the Lodha and Phoenix Mills climbed around 7-7.5%. Similarly, Godrej Properties, Sobha, and DLF rose between 6.5% and 7%, while Oberoi Realty and Brigade Enterprises gained around 5-5.5%.
Why the RBI rate pause matters
For sectors like banking, auto, and real estate, interest rates play a direct role.
Breaking it down, when rates are stable or lower, borrowing becomes cheaper. This boosts demand for loans, cars, and homes. This is why these sectors are often called “rate-sensitive.”
The RBI’s decision to hold rates has given clarity to investors.
At the same time, the central bank struck a cautious tone. It further noted that although growth remains strong, global risks such as the geopolitical tension still need to be watched closely.
Growth outlook adds to confidence
Along with the policy decision, the RBI also revised its economic projections. For the ongoing financial year, growth is seen at 6.9%.Governor Malhotra noted that India’s economic fundamentals remain strong but cautioned that supply disruptions could eventually impact demand if they persist. He highlighted that the string macro fundamentals continue to be key growth drivers.
