Markets Soar On RBI Rate Cut, Big Gains Ahead For Banks & Capital Goods?

In a bold move that caught analysts off guard, the Reserve Bank of India's latest rate cut has sent positive ripples across the capital markets. Kranthi Bathini, Director of Research at WealthMills Securities, notes that markets are climbing the proverbial "wall of worries", buoyed by the MPC’s monetary push—what he terms a "monetary moolah", "bazooka", and "bonanza". The rate cut, more aggressive than anticipated, is seen as a major booster for equity markets, particularly banking, financial services, consumption, infrastructure, and capital goods sectors. Bathini stresses that while domestic macroeconomic indicators remain favourable, global uncertainties such as trade tensions and geopolitical risks still loom large. Inflation trends, especially in the latter half of the year, will be crucial to monitor. Despite these concerns, the RBI’s policy stance reflects confidence in the domestic outlook, paving the way for markets to inch towards new highs.