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🖥EVEN AFTER LONG-AWAITED RATE CUT BY RBI MARKET WAS DOWN

BUT WHY??
THAT WAS NOT EXPECTED RIGHT 🧐


When the RBI (or any central bank like the US Fed🏦) cuts interest rates, many people assume that the stock market will go up immediately.

However, that’s not always the case.

Let’s break it down.➡️

1. Why Do Interest Rate Cuts Happen?

Central banks reduce interest rates mainly for two reasons:
To support the economy when growth is slowing down.
To control inflation when prices are under control but demand is weak.


2. Why Doesn't the Stock Market Always Go Up After a Rate Cut?

A rate cut is only good for the stock market if it signals strong economic growth ahead. But if the economy is weak, a rate cut can actually be a warning sign⚠️.

Here’s why:

a) Rate Cuts Usually Happen When the Economy is Weak
If the RBI is cutting rates, it could mean that business growth is slowing down, corporate earnings are under pressure, and consumer demand is falling.

Investors worry that companies won’t perform well in the coming months, so they sell stocks instead of buying.

b) Interest Rate Cycles Matter

Early in a rate cut cycle, markets often fall because the economy is still struggling.
Later in the rate cut cycle, once businesses start recovering and corporate earnings improve, the stock market usually picks up.

c) Strong Industrial Data is Needed

If the rate cut is accompanied by strong industrial production, job growth, and higher demand, the stock market can go up.
But if economic indicators remain weak, investors stay cautious, and stocks may continue to fall.

3. What Should a Trader Do?

Don’t assume that every rate cut is bullish. Look at other factors like corporate earnings, GDP growth, inflation trends, and global market conditions.

If the economy is still weak, focus on defensive stocks (like FMCG, pharma, utilities) instead of aggressive growth stocks.
Once industrial and economic data improve, that’s when the real stock market rally happens.


✏️So, in short: A rate cut alone doesn’t guarantee a market rally. The overall economic condition matters more!

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Chambal Fertilizer.
22 🔥

Chambal Fertilizer
Showing strength

Again

BTST

VIEW

CHAMBAL FERTILIZER
550CE

CMP 19

SUPPORT 15

EXPECTED 23-27


Disclaimer Reminder:-
Above calls are Not Buy or Sell Levels,These opinions are for educational purposes only, based on research. Consult your financial advisor before investing.

POSITIONAL VIEW

CHAMBAL FERTILIZER 540CE

17.5 TO 24 🔥

TAKE YOUR POINTS

SUPPORT 18

NOW

212 🔥

CHAMBAL FERTILIZER

CLOSING ABOVE 550

CAN EXPECT 🔥

POSITIONAL VIEW

CHAMBAL FERTILIZER

540CE

CMP 17.8

SUPPORT 13

EXPECTED VIEW 21

BIG UPSIDE VIEW 27++


Disclaimer Reminder:-
Above calls are Not Buy or Sell Levels,These opinions are for educational purposes only, based on research. Consult your financial advisor before investing.

OPTION BUYING

2-3 DAYS VIEW

HAL 3700CE

CMP 185

SUPPORT 150

EXPECTED 225+


Disclaimer Reminder:-
Above calls are Not Buy or Sell Levels,These opinions are for educational purposes only, based on research. Consult your financial advisor before investing.

OPTION BUYING

MUTHOOT FIN

2300CE

60 to 69 🔥

Still showing strength