Indian Shares, Rupee Fall; Bond Yields Rise on RBI Policy Stance

An end-of-day recap of all that transpired in the Indian markets, highlighting the major price movements and the factors driving them

By Dehuti Jani

October 7, 2026 at 12:55 PM IST

Benchmark equity indices snapped their two-day gaining streak on Wednesday after the Reserve Bank of India raised the repo rate by 25 basis points to 5.50% and shifted its monetary policy stance to “calibrated tightening”, highlighting concerns over inflation risks from elevated oil prices and tighter global monetary conditions.

The Nifty50 fell 0.76% to 22,603.05, while the Sensex declined 0.59% to 72,638.70. Both indices had been down about 0.7% before the policy decision.

Fourteen of the 16 major sectoral indices ended lower. The Nifty MidCap 100 fell 0.63%, while the Nifty SmallCap 100 gained 0.30%. Nifty Metal was the worst-performing sector, while Nifty PSU Bank rose the most. Titan Company, Adani Enterprises and Hindalco Industries were the top Nifty 50 losers.

The RBI's decision also weighed on the rupee and government bonds. The rupee fell to 96.8450 per US dollar, near its record low of 96.96 touched on May 20, before ending 0.4% lower at 96.7750. The currency remained under pressure despite persistent RBI intervention.

Most Indian government bonds remained under pressure as traders reshuffled positions following the RBI's rate hike and shift in stance, although long-term bonds gained on firm investor demand. The benchmark 6.94%, 2036 bond yield ended at 7.2410%, up from 7.1928% on Tuesday after touching an intraday high of 7.2655%.

Top Movers of the Day

Moneyview surged 18.16% to ₹59.67 as fintech stocks rallied after the Reserve Bank of India's monetary policy committee raised the repo rate by 25 basis points to 5.50%. The shares have continued to update momentum after its recent high-profile IPO and strong market debut on October 1.

Ashok Leyland dropped 2.80% to ₹149.40 amid sharp selling pressure in auto stocks after the RBI raised the repo rate and shifted its stance to calibrated tightening.

Maruti Suzuki India declined 1.08% to ₹11,499.00 as the central bank's hawkish tone and signal that rate cuts are off the table dampened sentiment for rate-sensitive automobile manufacturers.

Tata Motors Passenger Vehicles slipped 2.80% to ₹283, tracking a broader slump in the Nifty Auto index triggered by the RBI's 25-basis-point rate hike and shift in the policy stance to calibrated tightening.

PVR INOX rose 6.86% to ₹1,335.10, emerging as one of the top gainers and hitting a 52-week high following a bullish note from CLSA brokerage firm maintaining ‘outperform’ rating.

Cupid jumped 6.25% to ₹344.90, hitting a new all-time high and strongly outperforming the market following reports that suggested Cupid may transition from a small cap to mid-cap stock in AMFI’s upcoming classification review.

Aegis Logistics advanced 4.86% to ₹1,463.70, finding robust buying interest throughout the trading session on positive investor sentiment in energy infrastructure stocks.

Mangalore Refinery and Petrochemicals gained 4.62% to ₹182.80 due to elevated global crude oil prices driven by supply constraints. Higher crude prices typically benefit refiners such as MRPL.

Indraprastha Gas climbed 3.62% to ₹146.50 as investors favoured specific energy and utility counters during the session. The shares rose on a clean technical uptick and prior CNG prices hike and domestic connection incentives.

Pine Labs rose 2.91% to ₹177.75, tracking a broader rally in fintech and financial services stocks after the RBI announcement enabling interoperability among NBFC account aggregators

Computer Age Management Services edged up 0.01% to ₹694, showing resilience along with other financial technology stocks despite the central bank's rate increase.

Inox Green Energy Services fell 8.08% to ₹134.7 after the company completed a ₹5.50-billion payment for the transfer of the wind operations and maintenance business.

Futures & Options
The Nifty October 2026 futures closed at 22,618.40, a premium of 15.35 points over the Nifty 50's cash-market close of 22,603.05. The Nifty 50 fell 173.05 points, or 0.76%, during the session, while the NSE's India VIX, a gauge of expected near-term volatility, rose 2.25% to 13.92.

HDFC Bank, Bharti Airtel and ITC were the most-traded individual stock futures contracts in the NSE's F&O segment. The October 2026 F&O contracts will expire on 27 October 2026.

Bonds
Indian government bond yields rose after the RBI’s 25-basis-point rate hike and shift to “calibrated tightening”, with higher oil prices and US Treasury yields adding pressure. The benchmark 6.94%, 2036 yield closed at 7.2410%, up from 7.1928% on Tuesday, after touching 7.2655% intraday. Losses eased as the RBI omitted liquidity-draining measures, supporting short-term bonds.

At the 230-billion-rupee Treasury bill auction, strong 91-day demand set the cutoff at 5.57%, which is 3 basis points below the 91bps poll. Weak bank demand lifted 182-day and 364-day cutoffs to 6.10% and 6.29%.

Forex
The Indian rupee fell to a five-month low and neared its record low on Wednesday despite the Reserve Bank of India's shift in its policy stance to “calibrated tightening”, as the move was not hawkish enough to support the currency. The rupee surrendered early gains to hit 96.8450 per US dollar, close to its record low of 96.96 reached on May 20, before ending 0.4% lower at 96.7750.

The rupee has remained under pressure despite persistent RBI intervention and more than $140 billion of inflows generated by the central bank's one-off policy measures. RBI Governor Sanjay Malhotra described short-term financial market behaviour as “irrational” and said the rupee may be undervalued according to several measures, including the real effective exchange rate.

Crypto
The cryptocurrency market came under renewed selling pressure on Wednesday as a sharp decline triggered a wave of liquidations across leveraged positions. Long bets worth $403.58 million were liquidated within an hour, intensifying concerns over a broader derivatives-driven pullback.

Bitcoin fell around 1.7% to about $84,072, slipping below the $85,000 level as retail selling pressure increased. Ethereum underperformed, falling 3.5% to around $2,613 as the leverage flush weighed more heavily on the broader crypto market.

US Stock Futures
US stock futures edged lower early Wednesday after the S&P 500 reached a fresh intraday high and a record close in the previous session, driven by a rally in technology stocks. Dow Jones Industrial Average futures fell 0.22%, S&P 500 futures slipped 0.1%, while Nasdaq-100 futures declined 0.37%.

Chipmakers led Tuesday's gains, with Marvell Technology rising 5.8% after raising its revenue guidance and Advanced Micro Devices gaining 2.8% after Citi raised its price target, citing stronger demand for central processing units. Investors were now awaiting minutes from the Federal Reserve's September meeting for further clues on the interest-rate outlook.

US Treasury Notes
US Treasury note yields remained near multidecade highs on Wednesday as the bond market stayed under selling pressure. The benchmark 10-year Treasury yield hovered around 5.32%, while the 30-year yield remained near 5.70%, with investors awaiting the Federal Reserve's September meeting minutes.

Yields remained elevated amid persistent fiscal deficits, increased corporate debt issuance linked to artificial intelligence infrastructure and geopolitical tensions that have pushed oil prices higher, adding to concerns over longer-term inflation. The 2-year Treasury yield held around 4.806%, while the 5-year yield stood near 5.06%.

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Indian Shares, Rupee Fall; Bond Yields Rise on RBI Policy Stance