NIFTY ABOVE 26,150; IT SHARES ADVANCE

The key equity benchmarks traded with modest gains in the early afternoon trade, after the RBI trimmed the repo rate by 25 basis points to 5.25%. Traders are tracking ongoing IPO activity, crude oil trends and global cues. Market participants are also looking ahead to the US Personal Consumption Expenditure data scheduled for release on Friday, which could influence Fed policy. The Nifty traded above the 26,150 mark. IT shares witnessed buying demand for the third consecutive trading session.

At 12:30 IST, the barometer index, the S&P BSE Sensex, advanced 458.01 points or 0.54% to 85,723.33. The Nifty 50 index rose 145.55 points or 0.56% to 26,179.30.

The broader market underperformed the frontline indices. The S&P BSE Mid-Cap index rose 0.03% and the S&P BSE Small-Cap index shed 0.75%.

The market breadth was negative. On the BSE, 1,662 shares rose and 2,265 shares fell. A total of 190 shares were unchanged.

Economy:

The Reserve Bank of India Governor Sanjay Malhotra, announcing the fifth bi-monthly policy review of FY26, said that RBI�s MPC has unanimously decided to reduce the policy repo rate by 25 basis points to 5.25%, keeping its stance neutral.

The MPC voted unanimously to reduce the rate under the liquidity adjustment facility, which also revised the standing deposit facility (SDF) rate to 5% and the marginal standing facility (MSF) and bank rate to 5.50%, while maintaining a neutral stance.

The RBI raised its real GDP growth forecast for FY26 to 7.3% from 6.8% earlier, expecting 7% growth in Q3 and 6.5% in Q4. For Q1 and Q2 FY27, growth is projected at 6.7% and 6.8%, respectively.

The CPI inflation forecast for FY26 was lowered to 2% from 2.6%, with expectations of 0.6% in Q3 and 2.9% in Q4. CPI for Q1 and Q2 FY27 is projected at 3.9% and 4%.

The MPC noted that headline inflation has eased sharply due to exceptionally benign food prices, while core inflation has softened and is expected to stay anchored near the 4% target in the first half of FY27.

The committee said the balance between growth and inflation continues to offer policy space to support economic momentum.

The minutes of the meeting will be published on 19 December, and the next MPC meeting will be held from 4 to 6 February 2026.

Derivatives:

The NSE`s India VIX, a gauge of the market`s expectation of volatility over the near term, fell 2.86% to 10.51. The Nifty 30 December 2025 futures were trading at 26,350, at a premium of 172.3 points as compared with the spot at 26,177.70.

The Nifty option chain for the 30 December 2025 expiry showed a maximum call OI of 66.9 lakh contracts at the 26,000 strike price. Maximum put OI of 77.4 lakh contracts was seen at 26,000 strike price.

Buzzing Index:

The Nifty IT index rose 1.34% to 38,875.85. The index rose 3.56% in the three consecutive trading sessions.

HCL Technologies (up 1.99%), LTIMindtree (up 1.68%), Mphasis (up 1.3%), Wipro (up 1.1%), Tech Mahindra (up 0.99%), Tata Consultancy Services (up 0.97%), Coforge (up 0.96%), Persistent Systems (up 0.92%), and Oracle Financial Services Software (up 0.41%) rose.

Stocks in Spotlight:

Z-Tech (India) advanced 2.89% after the company announced that it has secured new urban development projects worth Rs 7.09 crore from the Municipal Corporation of Delhi (MCD).

Lupin rose 0.40%. The company announced that it has received tentative approval from the U.S. Food and Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) for Siponimod Tablets in 0.25 mg, 1 mg and 2 mg.

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