The key equity indices continued to trade with strong gains near the day's high in morning trade. The Nifty hovered around the key 17,400 mark. Investors cheered the RBI Monetary Policy Committee (MPC)'s decision to keep the key interest rates unchanged.

At 10:25 IST, the barometer index, the S&P BSE Sensex, was up 735.65 points or 1.28% to 58,369.30. The Nifty 50 index added 216.35 points or 1.26% to 17,393.05.

In the broader market, the S&P BSE Mid-Cap index rose 0.97% while the S&P BSE Small-Cap index added 1.27%.

The market breadth was strong. On the BSE, 2334 shares rose and 651 shares fell. A total of 131 shares were unchanged.

RBI MPC meet outcome:

The Reserve Bank of India (RBI) kept the policy repo rate unchanged while maintaining its accommodative stance after the conclusion of the Monetary Policy Committee (MPC) meeting today, 8 December 2021.

The Nifty Bank index was up 1.44% at 37,145.90. Meanwhile, the Nifty 50 index was up 1.34% at 17,407.50.

ICICI Bank (up 2.21%), SBI (up 1.76%), Bandhan Bank (up 1.6%), RBL Bank (up 1.55%), AU Small Finance Bank (up 1.5%), HDFC Bank (up 1.28%), IndusInd Bank (up 1.21%), IDFC First Bank (up 1.15%), Axis Bank (up 1.08%), Punjab National Bank (up 0.78%), Federal Bank (up 0.73%) and Kotak Mahindra Bank (up 0.64%) advanced.

RBI kept repo rate unchanged at 4% and maintained an accommodative stance. Reverse repo rate stands at 3.35%. The Marginal Standing Facility (MSF) rate is at 4.25%

The MPC said the policy stance will remain "accommodative" until there is sustainable recovery in the economy.

RBI maintained the FY22 GDP growth forecast at 9.5%. It retained CPI inflation projection at 5.3% in 2021-22.

Stocks in Spotlight:

FSN E-Commerce Ventures (Nykaa) shed 0.30% to Rs 2146.20 as the mandatory one-month lock-in of anchor investors expired for the stock today. Nykaa raised Rs 2,395.84 crore in its anchor book allocation from 174 investors ahead of its IPO. The firm allocated 2,12,96,397 shares at the upper price band of Rs 1,125 per equity share.

Zen Technologies added 2.84% to Rs 2146.20. Unistring Tech Solutions (UTS), a subsidiary of the company, secured an order worth Rs 61 crore from an Indian defence PSU.

NHPC added 0.60% to Rs 33.75. The company's board has approved the proposal for monetization by securitization through bidding process of return on equity (RoE) of Chamera-1 Power Station (3 X 180 MW), Himachal Pradesh.