Indian Stock Market Today: Indian markets witnessed opening of the equity indices on a negative note on Thursday, October 8, due to the RBI’s sudden move towards tightening of monetary policy amid higher crude prices and outflow of foreign institutional investors.
The BSE Sensex index saw a fall in opening by 0.24% to 72,455.17 levels while Nifty 50 was trading lower by 0.23% at 22,545.85 levels. This came after a steep fall in the previous session wherein the BSE Sensex index had fallen by 429.11 points and Nifty 50 by 173.05 points.
Why Is Indian Stock Market Down Today?
RBI Rate Hike Raises Pressure on Equities
The primary reason in the Indian domestic front is the latest monetary policy move made by the RBI. In its monetary policy move made on October 7th, the RBI increased the repo rate by 25 basis points to 5.50%, signaling its first increase in nearly four years. More importantly for the investors, however, the RBI altered its policy stance to “calibrated tightening” from its earlier “neutral” stance. This shift is creating apprehensions among the investors regarding a possible sustained period of high rates along with possible increases in the future if inflation remains an issue.
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Rising Crude Oil Prices Add to Inflation Concerns
Crude oil continues to be one of the critical factors affecting the stock markets in India. The Brent Crude price crossed the $101 mark per barrel due to fears of oil supply disruptions in the Middle East and the Strait of Hormuz. According to Reuters news agency, the Brent Crude price was above $102 a barrel during the early trading hours on Thursday. It is noteworthy that high oil prices become significant for India since the country depends a lot on crude imports.
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