Tale of the Tape 

Good evening everyone. Happy Friday!

Nifty (-0.2%) and Sensex (-0.3%) ended in the red for a third day in a row. Midcaps (+0.2%) and Smallcaps (-0.3%) traded mixed. The advance-decline ratio was in favour of the bears (3:2). Check out the Stocktwits Sentiment Meter:

It was an even mix of red and green for sectors. Metals (+2.7%) and Auto (+0.7%) were the top gainers. PSU Banks (-1.4%), FMCG (-1.3%) and Oil & Gas (-0.9%) witnessed the most selling pressure.

It was RBI rate cut day today! Read our top story for how the central bank’s first cut in 5 years will help both you AND the economy.

Bharti Airtel (+4%) gained on a solid Q3 show. Meanwhile, Ola Electric (-2%) fell after disappointing Q3 numbers. More details below.

PFC and REC rallied after the RBI said the new project financing guidelines won’t be implemented until March 2026.

Infosys laid off 700 employees from its Mysuru campus as part of its cost-cutting efforts. 

Zomato will change its parent company’s name from “Zomato” to “Eternal”. Weird!

Alkem Labs will buy Bombay Ortho Industries for Rs 147 cr. 

Cummins India dropped -3% despite maintaining its double digit growth guidance in FY25. 

Q3 reactions. Bikaji Foods tanked -10% after its net profit fell -39% YoY. Sonata Software cracked -12% after saying it expects Q4 to be a “degrowth” quarter.

Here are the closing prints:

Economy
RBI Monetary Policy: Key Takeaways

Rate cuts are FINALLY here!! The Reserve Bank of India reduced interest rates for the first time since 2020 today, with the repo rate now coming down to 6.25% vs 6.5% earlier. ICYMI - inflation fell to a 4-month-low in December and we’re set to grow at our slowest pace in four years in FY25. It’s clear that something needed to be done. 

Newly appointed RBI governor Sanjay Malhotra pointed out that inflation would further reduce in 2025-26 and that support needed to be given to growth.

The money quote: “Considering the existing growth-inflation dynamics, the MPC, while continuing with the neutral stance, felt that a less restrictive monetary policy is more appropriate at the current juncture.” Music to our ears!

Why should you care? Well, your EMIs will come down for the first time in five years. Suppose you had a Rs 50 lakh home loan at a 9% interest rate. That will come down to 8.75%, saving you Rs 4.36 lakh in interest AND reduce your tenure by 10 months. A Rs 1 crore loan at the same rate means you now save Rs 8.7 lakh in overall interest payments! Not too bad and considering the recent income tax cuts, that means a LOT more money in your pocket starting April 1. More broadly, this is a big boost for the economy and & rate-sensitive stocks including banks, auto, real estate & consumer durables. Lower rates = more lending = more spending. 

The big question: How much more will the RBI cut in the future? It didn’t go full dovish. But its inflation forecast for FY26 is 4.2%, while GDP growth is predicted at 6.7%. This means there’s ample scope for more than 50 bps in cuts, experts say!

Stocktwits Specials
Best Time To Buy FMCG Stocks!

FMCG stocks are all the hype after Finance Minister Nirmala Sitharaman made income up to ₹12 lakh tax-free! Every expert on the Street is betting on FMCG stocks to make a comeback in 2025. But, confused which one to pick? Check out our latest video where we highlight 5 breakout stocks that SEBI RAs are most bullish on!