Sensex, Nifty open higher ahead of RBI decision; Tata Motors stock gains 2%

Benchmark stock market indices opened higher on Wednesday ahead of the Reserve Bank of India’s (RBI) monetary policy meeting, where the bank is likely to keep the repo rate unchanged.

The S&P BSE Sensex added 129.72 points to 81,764.53, while the NSE Nifty50 gained 46.35 points to 25,059.50 as of 9:30 AM. Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said that the ‘Sell India, Buy China’ strategy pursued by the FIIs recently appears to be coming to an end as indicated by the declining FII sell numbers and the profit booking in Chinese stocks, particularly those listed in Hong Kong.

“An important takeaway from the FIIs vs DIIs tug-of-war that has happened anytime in the ongoing bull rally is that the fight ended in the victory of the DIIs each time. FIIs are selling on valuation concerns; DIIs are buying because they have deep pockets to buy and the pockets are getting deeper.

This trend is likely to continue. BJP’s victory in Haryana has come as a morale booster for the party and confidence booster for markets. The sentiments will get a further boost if the MPC decides to change the monetary stance from accommodative to neutral and sound a bit dovish today. A rate cut, however, is unlikely since food inflation continues to be a worry,” he added.