Key Indian stock indices logged losses on Thursday, December 5. The Reserve Bank of India’s decision to leave monetary policy unchanged came as a surprise to market participants since most expected at least a 0.25% rate cut. The regulator held its key rate steady at 5.15%, while analysts expected a reduction to 4.90% on average. The reverse repo rate remained at 4.9%, the same as at the previous meeting, vs. expectations of a reduction to 4.65%, while reserve requirement ratio remained unchanged at 4.0%, matching the median consensus. In sectoral terms, steel makers incurred the heaviest losses. The external backdrop was favorable as key Asian benchmarks gained and European equities were trading in the green. Recapping the indices, the Nifty 50 eased 0.21% to 12,018.40, while the BSE Sensex slipped 0.17% to 40,779.59. By 10:17 GMT, USD/INR dipped 0.10% to 71.401, while the EUR/INR pair was 0.02% higher at 79.1745. The yield on the 10-year Indian government bond widened to 6.592%. As noted above, the top underperformers were steel makers, with JSW Steel, Tata Steel and Steel Authority of India (SAIL) giving up 3.2%, 2.3% and 1.7%, respectively. Notable outperformers included mass media company Zee Entertainment (+6.7%). The daily chart shows that the BSE Sensex is trading near the upper line of Bollinger Bands after having recently broken through the lower line of a rising wedge. The Slow Stochastic Oscillator and the RSI are not far from overbought territory. In light of the above, the index could extend its descent in the short term.