The Reserve Bank of India’s swift and timely monetary response to the devastating wave of Covid-19 gave Indian equities further momentum, climbing 0.8% on Wednesday. Well-designed RBI measures, which analysts say are adapted to the changing situation, could support the economy in the future.

Previously, Apex Bank announced a Rs 50,000 crore Covid-19 healthcare package for vaccine manufacturers, medical equipment suppliers, hospitals and patients in need of funding. In addition, individual borrowers and small businesses with loan outstanding of up to Rs 25 crore, and who did not avail for moratorium or restructuring relief last year, can ask for restructuring of their loans for up to 2 years.

The statements were met with approving responses from market participants, who were delighted to see the work of pharmaceutical companies and banks. The Nifty Pharma Index grew by more than 4%, while individual stocks such as Lupine, Aurobindo Pharma, Cadila Healthcare, Sun Pharma and Torrent Pharma increased by 5-14%.

The Nifty Financial Services, IT, Auto and Metal indices were up 1.3% versus NSE.

Overall, S&P BSE Sensex closed the session at 48,678 points, up 424 points. In day-to-day trades, the 30-stock barometer hit highs and lows at 48,743 and 48,254, respectively.

On the NSE, Nifty50 hit an intraday high of 14,637 but closed at 14,618, up 121 points.

In the larger markets, the S&P BSE MidCap closed more than 1% higher, while the S&P BSE SmallCap gained 0.7%.

According to the rating agency Standard & Poor’s, the second wave of Covid could derail a strong economic recovery and worsen credit conditions in India. The agency estimates that economic growth could reach 1.2% in a moderate state, which will lead to a 9.8% increase in GDP in fiscal year 22. Under difficult conditions, the blow could be 2 , 8%, resulting in an 8.2% GDP growth.

Meanwhile, growth in India’s dominant service sector fell to three-month lows in April. The IHS Markit Services PMI fell to 54 last month from 54.6 in March, the lowest level since January. However, it was well above the 50 mark, which separates growth from decline, and surpassed expectations in a Reuters poll of a drop to 51.1.