Indian stock markets started the new month on a strong note, with the Nifty 50 index climbing over 190 points to breach the 24,800 mark. The Sensex also saw robust gains, soaring nearly 650 points to touch 80,900. The rally was primarily driven by strong performances in banking stocks, with the Nifty Bank index jumping over 600 points to surpass 55,000.
Key gainers in the Nifty 50 included Shriram Finance, Tata Motors, Trent, Kotak Bank, and Bajaj Auto, while stocks like Bajaj Finance, SBI, and Asian Paints were among the notable losers. The broader Nifty 500 index saw strong performances from companies such as Sun TV, HUDCO, NMDC, Tata Investment, Pfizer, and Lupin.
The market’s positive momentum followed the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) decision to maintain interest rates and retain a neutral monetary policy stance. RBI Governor Sanjay Malhotra, during the post-policy press conference, highlighted the resilience of India’s economy, driven by domestic activity, and emphasized efforts to counter global uncertainties while maintaining price stability.
Key Market Highlights
- Nifty Bank Rally: The Nifty Bank index surged past 55,000, gaining over 650 points after the RBI announced new banking regulations, including relaxed lending norms and enhanced limits for loans against shares and IPO financing.
- Tata Motors Demerger: Tata Motors set October 14, 2025, as the record date for its commercial vehicle business demerger, with shareholders receiving one share of the new entity for every Tata Motors share held.
- Atlantaa Shares Soar: Atlantaa’s stock hit the upper circuit after securing a ₹2,485 crore contract with IRCON.
- Aurobindo Pharma Update: The company announced the resignation of Associate Vice President S Venkatesh Kumar, effective September 30, 2025.
- Essar Power Dispute: The Supreme Court ruled in favor of Gujarat Urja Vikas Nigam (GUVNL) in a 20-year-old power supply dispute, confirming Essar Power’s wrongful diversion of electricity to its sister concern, Essar Steel. GUVNL is entitled to compensation, with the matter pending further assessment by the Gujarat Electricity Regulatory Commission (GERC).
RBI Policy Insights
RBI Deputy Governor Rajeshwar Rao noted that the banking system’s risk-handling capacity has improved, with new measures incorporating sufficient safeguards. The RBI also proposed:
- Removing lending caps on listed debt securities.
- Increasing loan limits against shares from ₹20 lakh to ₹1 crore.
- Raising IPO financing limits from ₹10 lakh to ₹25 lakh per person.
- Implementing the Expected Credit Loss (ECL) framework from April 1, 2027.
Sectoral Updates
- Auto Sector: Mahindra & Mahindra reported a strong festive season start, driven by GST benefits, favorable monsoons, and increased tractor demand. The company expects double-digit growth in the tractor industry for FY26. Escorts Kubota recorded a 47.6% rise in tractor sales for September, while VST Tillers reported a 35% increase in total sales.
- Hyundai Motor Sales: Hyundai posted a 10% year-on-year increase in total sales for September, reaching 70,347 units, with domestic sales up 1% at 51,547 units.
- Defence Stocks: Shares of Cochin Shipyard, Mazagon Dock, and Paras Defence gained attention amid market optimism.
Market Outlook
The RBI’s measures to promote rupee-based lending for trade with Bhutan, Nepal, and Sri Lanka aim to reduce reliance on the US dollar and mitigate exchange rate risks. Meanwhile, market experts cautioned about high IPO valuations, with Ajay Srivastava of Dimensions Corporate Finance Services warning that many IPO-listed stocks could see significant declines in the coming years.
Stay tuned for more updates as the market continues to react to RBI policies and corporate developments.
Source: Rewritten based on market updates, ensuring original phrasing and structure to avoid duplication.