{"id":295536,"date":"2026-10-08T15:26:37","date_gmt":"2026-10-08T09:56:37","guid":{"rendered":"https:\/\/univest.in\/blogs-2\/?p=295536"},"modified":"2026-10-08T15:26:37","modified_gmt":"2026-10-08T09:56:37","slug":"rbi-rate-hike-sell-stocks-and-buy-bonds-jefferies-view-10-year-yield-7-24-percent","status":"publish","type":"post","link":"https:\/\/univest.in\/blogs-2\/rbi-rate-hike-sell-stocks-and-buy-bonds-jefferies-view-10-year-yield-7-24-percent\/","title":{"rendered":"RBI Rate Hike: Time to Sell Stocks and Buy Bonds? What Jefferies Says About 75 to 100 bps of Hikes, Why the 10-Year Yield at 7.24% Cuts Both Ways, Which Banks Gain and the Risks of Moving Out of Equities"},"content":{"rendered":"

Jefferies: RBI hike expected but stance change lifts hike expectations to 75-100 bps (from 50). 10-yr yield 7.24%, highest since Dec 2023. Prefers banks over NBFCs: ICICI, SBI, Axis.<\/em><\/p>\n

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Quick Answer<\/strong><\/p>\n

Time to sell stocks and buy bonds is the question after the RBI raised the repo rate by 25 bps to 5.50% and changed its stance to calibrated tightening, which Jefferies says lifts consensus expectations for the cycle to 75 to 100 bps of hikes from 50 bps. The 10-year government bond yield settled at 7.24% on 7 October, the highest since December 2023, so bonds now pay more, but more hikes can push yields higher and bond prices lower, and a 25 bps rise costs about 1.7% on a 10-year bond, my duration estimate. Jefferies India argues that the cycle is a positive earnings catalyst for large private banks, PSU banks and housing finance companies, with ICICI Bank, SBI and Axis Bank as top picks, and a slight risk for smaller private banks, NBFCs and life insurers. Moving fully out of equities is not what the evidence supports, since stocks usually dip in the first months of a hiking cycle and recover, so the choice before you sell stocks and buy bonds is between short-duration bonds for safety and selective equity exposure.<\/p>\n<\/p><\/div>\n

Sell stocks and buy bonds sounds simple, but the RBI’s message was that policy risk is now tilted toward more hikes and not cuts, so both asset classes are repricing. The Nifty fell about 1.3% on 8 October and is about 15% below its September 2024 peak, while the 10-year yield has risen 58 bps since the US-Iran conflict began.<\/p>\n

If you are wondering whether to sell stocks and buy bonds, this article covers what the RBI did, the Jefferies view and bank picks, the bond market reaction, the maths of bond price risk, the equity case, an investor framework, the risks and what to watch.<\/p>\n

Click Here – Get Free Investment Predictions<\/a><\/strong><\/p>\n

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