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Mumbai: Indian benchmark indices remained under pressure on Thursday after the Reserve Bank of India raised the repo rate by 25 basis points to 5.50%. The move, coupled with elevated crude oil prices and concerns over tighter financial conditions, weighed on investor sentiment.
The Sensex and Nifty opened lower on Thursday, continuing the weakness seen after Wednesday’s RBI policy announcement. The Sensex slipped over 200 points in early trade, while the Nifty fell below the 22,600 mark.
The RBI’s decision marked its first repo rate increase since February 2023. Along with the rate hike, the central bank shifted its policy stance to “calibrated tightening”, signalling that interest rates could remain higher for longer.
Shares of Paytm parent One 97 Communications came under heavy selling pressure during Thursday’s session. The stock fell sharply amid reports that the proposed rollout of merchant fees on UPI transactions could be delayed.
Other digital payment companies, including MobiKwik and Pine Labs, also witnessed steep declines. Investors viewed a possible delay in UPI merchant charges as a setback for the sector’s expected revenue growth.
Rising crude oil prices have emerged as another concern for investors. Brent crude moved above $100 per barrel, raising worries over inflation and India’s import bill. The rupee’s weakness against the US dollar has added to the pressure.
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Foreign investors have also remained cautious. FIIs sold Indian equities worth ₹2,961.30 crore on Tuesday, according to exchange data.
Markets are now likely to track crude oil prices, global cues, currency movements and the upcoming corporate earnings season. IT stocks showed relative strength on Thursday, while several other sectors remained under pressure.
