Capital Market Stocks Surge Up to 8% Following RBI Relief

Indian Capital Market Stocks Surge on RBI's Three-Month Extension

The Indian capital market stocks kicked off the new financial year on a bullish note, recording gains of up to 8% on Wednesday, April 1, as the Reserve Bank of India (RBI) deferred its circular on capital market exposures of banks for a period of three months.

Against this backdrop, shares of Motilal Oswal Financial Services (MOSL) emerged as among the top gainers, rallying 8.5%. Angel One and BSE shares gained 7% each on the National Stock Exchange (NSE). Groww, CAMS, and Nippon Life India AMC, HDFC AMC, and Anand Rathi Wealth were higher between 3-6%.

The gains were accentuated by a positive setup in the Indian stock market following de-escalation hopes in the US-Iran war, which is in its fifth week. At the time of writing this report, the NSE Nifty was higher by 2.13% at the 22,800 level.

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The capital market stocks witnessed a relief rally after the RBI gave a three-month extension to implement the capital market exposure norms. The norms were to be implemented earlier on April 1. According to a report, RBI earlier this week said that bank financing to capital market intermediaries (CMIs) or for proprietary trading may be undertaken against 100% collateral comprising cash or cash equivalents. It said that the prohibition on extending finance to market makers against securities in which the market-making operations are undertaken has been removed.

The directions issued by the central bank in February 2026 were aimed primarily to provide an enabling framework for banks to finance acquisitions by Indian corporates. It was also meant to rationalise the limits for lending by banks to individuals against shares, units of REITs, InvITs, etc., and put in place a more principle-based framework for lending to CMIs.

Assessing the impact of these norms, JM Financial had then said that for loans to CMIs, 100% collateral requirement for funding (out of which 50% must be cash for MTF) and 40% haircut on shares for collateral value calculations may reduce bank funding access and result in high trading costs for brokers.

Now, with the deferment of these norms, Jefferies said that it could result in a smoother transition for brokers/proprietary traders, as bank guarantees can now be renewed for up to a year, according to a report. Jefferies believes that the move could be positive for stocks like BSE.

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