Indian Stock Market Falls as Rupee Hits Record Low and RBI Rate Cut Hopes Fade

Indian stock market today: Indian equities saw a sharp reversal from early gains on Monday, December 01, closing the session in the red as the rupee weakened to a fresh all-time low against the US dollar. Sustained foreign investor selling and diminishing expectations of an RBI rate cut later this week added to the overall pressure on market sentiment.

Both benchmark indices opened with strength and even scaled fresh record highs after a stronger-than-anticipated second-quarter GDP reading, yet the optimism proved short-lived. The indices gradually shed their gains and slipped into negative territory as the session progressed.

The Nifty 50 fell 150 points from its intraday high to end at 26,175, marking a 0.10 percent decline from the previous close. The S&P BSE Sensex also finished lower by 0.09 percent at 85,625 after losing 531 points from the day’s peak.

Sector Moves Turn Mixed Amid Indian Stock Market Today Volatility

Market performance remained uneven across sectors. Nifty Realty emerged as the biggest drag with a 1 percent decline. Losses were also recorded in Nifty Consumer Durables, Nifty Pharma, Nifty FMCG and Nifty Private Bank, which slipped up to 0.60 percent.

On the other hand, Nifty Auto and Nifty Metal delivered notable gains of 0.79 percent and 0.60 percent. Nifty IT also closed higher by 0.39 percent, while Nifty PSU Bank posted a modest rise of 0.25 percent.

GDP Boost Fades

India’s September-quarter GDP growth came in at 8.2 percent, but analysts believe the strong figure reduces the likelihood of an RBI rate cut in December. Several experts noted that additional monetary support may not be required for now. Despite the encouraging Q2 GDP data, manufacturing activity slowed in November, with industrial output falling to a nine-month low, according to a survey released Monday.

Rupee’s Record Low and GST Data Keep Sentiment Cautious

After touching a fresh lifetime low against the US dollar, the rupee added to market unease. Investor mood also turned cautious due to muted GST collections in November, attributed to lower tax rates. This contributed to a range-bound trading pattern despite the morning’s record highs.

Auto Sector Stands Out With Solid Sales and Seasonal Boost

The auto index outperformed the broader market on the back of robust November sales. Analysts said the sector benefited from GST rationalisation, softening inflation levels and strong seasonal demand driven by the wedding period. These factors supported auto stocks even as most other sectors struggled to hold ground.

Disclaimer:
The information provided in this blog is for educational and informational purposes only. It does not constitute investment advice, a recommendation, or an offer to buy or sell any financial instruments. Stock market investments are subject to market risks. Past performance is not indicative of future results. Readers are advised to consult a qualified financial advisor before making any investment decisions. The author and publisher are not liable for any losses or damages arising from the use of this information.

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