Equity benchmarks ended Friday’s session with strong gains as the Reserve Bank of India’s 25 basis points repo rate cut to 5.25 per cent spurred broad-based buying in rate-sensitive sectors, with the Sensex closing at 85,712.37, up 447.05 points or 0.52 per cent, while the Nifty advanced 152.70 points or 0.59 per cent to settle at 26,186.45.
The RBI’s unanimous decision, bringing cumulative cuts to 125 basis points since February 2025, was driven by record low retail inflation of 0.25 per cent in October. The central bank also announced ₹1 lakh crore of open market operations in government securities and a three-year dollar-rupee buy-sell swap of 5 billion USD to inject durable liquidity into the system.
“Today, the Indian equity markets demonstrated strong resilience as the RBI anticipated 25 basis points repo rate cut announced at the conclusion of its MPC meeting galvanized investor confidence and triggered broad based gains across rate sensitive sectors,” said Abhinav Tiwari, Research Analyst at Bonanza.
Banking and financial services stocks led the advance, with the Nifty Bank index rising 488.50 points or 0.82 per cent to 59,777.20, while Nifty Financial Services surged 270.45 points or 0.98 per cent to 27,881.90. Shriram Finance topped the gainers list, jumping 3.04 per cent to close at ₹853.35, followed by State Bank of India, which gained 2.49 per cent to ₹971.70. Bajaj Finserv added 2.13 per cent to end at ₹2,092.90, while Adani Enterprises rose 2.03 per cent to ₹2,263.00 and Maruti Suzuki climbed 1.91 per cent to ₹16,300.00.
The broader market presented a mixed picture with the Nifty Midcap 100 index gaining 294.80 points or 0.49 per cent to 60,594.60, while the Nifty Smallcap 100 declined 100.10 points or 0.57 per cent to 17,507.75. Market breadth remained weak for the sixth consecutive session, with 2,423 stocks declining against 1,740 advancing on the BSE, where 4,328 stocks were traded. The exchange recorded 91 stocks hitting 52-week highs while 304 touched 52-week lows.
“In the last week, the benchmark indices witnessed a roller-coaster activity,” said Amol Athawale, VP Technical Research at Kotak Securities. “The Nifty ended 0.08 per cent lower, while the Sensex was down by 5 points. Among sectors, the IT index outperformed, rallying 3.30 per cent, whereas the Nifty Tourism index lost the most, shedding 3.40 per cent.”
In stock-specific action, Kaynes Technologies declined 12 per cent following brokerage assessments pointing to potential governance issues. IndiGo shares fell 1.2 per cent despite DGCA providing temporary regulatory relief, as the airline faced operational disruptions with nearly 500 flight cancellations on December 5 alone.
The rupee traded marginally weaker by 0.08 paise at 89.92 against the dollar as persistent foreign institutional investor selling kept pressure on the currency. “While the RBI’s 25 bps rate cut may offer some stability to financial sectors, delays in the India–US trade deal and soaring bullion and metal prices continue to weigh on sentiment,” said Jateen Trivedi, VP Research Analyst at LKP Securities. “Rupee is expected to move within a range of 89.75–90.25.”
In commodity markets, spot gold held above $4,220 per ounce as investors remained cautious ahead of key US inflation data. “Markets currently price in an 87 per cent probability of a 25-basis-point Fed rate cut next week,” said Kaynat Chainwala, AVP Commodity Research at Kotak Securities. WTI crude oil prices remained steady near $59.70 per barrel amid geopolitical tensions linked to the Russia-Ukraine conflict.
Looking ahead, markets are expected to track December-quarter results and updates on the US Federal Reserve’s policy path. “Immediate resistance is now seen around 26,300, followed by 26,500, while on the downside, the 25,950–26,000 band is expected to act as a crucial support zone in the near term,” said Nandish Shah, Deputy Vice President at HDFC Securities.
Published on December 5, 2025
