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Stock Market Today: Nifty 50 settles near 21,000 as RBI raises growth forecast; bank, IT stocks shine

This raised expectations that the central bank won't hinder growth and might lower interest rates if needed

Stock Market Today: Nifty 50 settles near 21,000 as RBI raises growth forecast; bank, IT stocks shine
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Frontline indices the Sensex and the Nifty 50 ended in positive territory on Friday, December 8, on gains led by banking and IT stocks, including HDFC Bank, Infosys and ICICI Bank, after the Reserve Bank of India kept the repo rate unchanged and raised the GDP growth forecast for the financial year 2024.

The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) kept the repo rate unchanged at 6.5 per cent and maintained the policy stance of 'withdrawal of accommodation' on Friday.

Besides, the RBI raised its real GDP growth projection for FY24 to 7 per cent from 6.5 per cent earlier. However, the central bank kept the inflation forecast unchanged as it projected Consumer Price Index (CPI)-based inflation, or retail inflation, at 5.4 per cent for FY24.

The RBI sounded optimistic about India's economic growth even though it highlighted that the global economic environment remains fragile amid geopolitical tensions. Apart from the bullish commentary on India's growth, RBI also talked about the risk of over-tightening.

This raised expectations that the central bank won't hinder growth and might lower interest rates if needed.

Following the policy announcement, the Nifty 50 breached the 21,000 mark for the first time and hit its all-time high of 21,006.10 during the session. The Sensex also hit its fresh record high of 69,893.8 during the session.

Nifty 50 closed at 20,969.40, up 68 points, or 0.33 per cent while the Sensex closed the day at 69,825.60, up 304 points, or 0.44 per cent.

Banking and IT heavyweights, such as HDFC Bank, Infosys, ICICI Bank, HCL Tech and Axis Bank, ended as the top contributors to the gains in the Sensex index.

The BSE Midcap and Smallcap indices also hit their fresh record highs of 35,523.69 and 41,548.63 respectively, during the session.

However, both erased their gains and ended in the red. The BSE Midcap index settled with a loss of 0.16 per cent at 35,290.91 while the Smallcap index lost 0.44 per cent to close at 41,104.37.

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