Sensex and Nifty end 4-day winning streak ahead of RBI policy

Mumbai: Benchmark equity indices closed lower on Tuesday, snapping a four-day winning streak. Investors turned cautious ahead of the Reserve Bank of India’s (RBI) monetary policy decision scheduled for Wednesday.
Weakness in banking, financial, and IT stocks weighed on market sentiment. The Sensex fell 210.08 points, or 0.27 percent, to close at 78,428.95.
The Nifty dropped 159.40 points, or 0.64 percent, to close at 24,614.90. Commenting on the Nifty’s technical outlook, experts noted that the index drifted lower throughout the day, moving towards the 24,400 support zone and hitting an intraday low of 24,428.
An analyst said, “Although it attempted a recovery from lower levels, buying interest remained limited, and the index faced selling pressure near the 24,500 zone, which has now solidified as an immediate resistance level.”
They added, “On the downside, the 24,400 zone remains the immediate support area. However, if it sustains below 24,400, profit-booking could intensify, potentially pushing the index towards the 24,300 support zone.”
Market participants remained cautious throughout the session amidst uncertainty regarding the RBI’s policy decision due on Wednesday.
Investors kept a close watch on interest rate expectations and the central bank’s commentary on inflation and economic growth.
Among Nifty constituents, Grasim Industries, HDFC Life Insurance Company, and Hindustan Unilever were the top losers, exerting pressure on the benchmark index.
Weakness was also observed across several key sectors. Heavy selling in realty stocks caused the Nifty Realty index to fall by over 2 percent, making it the worst-performing sectoral index of the day.
The Nifty FMCG, Nifty Private Bank, and Nifty Bank indices also closed lower.
Performance in the broader market segment was mixed; the Nifty Midcap index fell 0.29 percent, while the Nifty Smallcap index bucked the trend to close with a gain of 0.23 percent. Following significant gains over the previous four sessions, the decline in benchmark indices suggests that investors preferred to stay on the sidelines ahead of the RBI’s policy decision.
Experts say that market participants will now look for cues regarding interest rates, inflation, and liquidity conditions from the central bank’s stance to determine the market’s future direction.