The Indian stock market experienced a volatile trading session on February 7, 2025, as benchmark indices Sensex and Nifty ended in the red despite an initial rally following the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) announcement. The BSE Sensex closed 197.97 points or 0.25% lower at 77,860.19, while the NSE Nifty 50 slipped 43.40 points or 0.18% to settle at 23,559.95.
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Indian stock markets closed lower as Sensex and Nifty reacted to RBI’s latest monetary policy announcement. |
Market Performance Highlights
- Sensex: Dropped 197.97 points (-0.25%) to close at 77,860.19
- Nifty 50: Declined 43.40 points (-0.18%) to end at 23,559.95
- Nifty Bank: Closed down 223.25 points (-0.44%) at 50,158.85
- Biggest Losers: ITC, SBI, and banking stocks saw notable declines
- Foreign Institutional Investors (FIIs): Offloaded equities worth Rs 3,549.95 crore
Market Reaction to RBI MPC Decision
The markets showed initial optimism in early trade after the RBI, under new Governor Sanjay Malhotra, decided to cut interest rates for the first time in nearly five years. The BSE Sensex surged 233.96 points to hit an intraday high of 78,290.08, while the NSE Nifty climbed 83.40 points to touch 23,686.75. However, profit booking and concerns over global economic trends led to a reversal in gains by the closing bell.
Sectoral Performance
- Banking & Financials: Nifty Bank remained under pressure, closing in the negative.
- IT & FMCG: Sectors like ITC and SBI were among the top losers.
- Metals & Auto: Showed resilience, with some stocks managing marginal gains.
Market Sentiment & Investor Outlook
Despite the rate cut, the market sentiment remained cautious amid concerns over inflation, global geopolitical risks, and foreign institutional investor (FII) outflows. The decline in heavyweight stocks contributed to the downward trend in indices.
On Thursday, Sensex had already shed 213.12 points (-0.27%) to settle at 78,058.16, while Nifty fell 92.95 points (-0.39%) to end at 23,603.35. The consecutive declines indicate uncertainty among investors, especially with upcoming economic data releases.
Key Takeaways for Investors
- Volatility likely to persist as markets digest RBI's rate cut decision.
- Sectoral shifts evident, with banking stocks facing pressure while auto and metal stocks see some resilience.
- FIIs remain net sellers, a trend that could impact future market movements.
- Short-term cautious approach advised, with focus on global cues and domestic policy shifts.
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