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Sensex tanks 417 points to 24,983; Nifty drops to 7,631

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sensex, nifty, down, closing

Mumbai: Market benchmark Sensex plunged over 400 points as the Reserve Bank's 25 basis points repo rate cut, which was in line with market expectations, failed to boost the sentiment.

RBI Governor Raghuram Rajan also took a host of measures on the liquidity front, starting with the narrowing of policy rate corridor to 0.5 per cent from the earlier 1 percentage point, which resulted in the reverse repo rate — at which banks can park excess funds with the bank — being reset at 6 per cent.

Stating that the inflation objectives are closer to being realised and price rise will hover around the 5 per cent mark for the remainder of the fiscal, Rajan reaffirmed that the monetary policy will continue to remain accommodative to address the growth concerns.

The 30-share index, which had lost over 125 points in the opening trade, dropped further to quote 417 points or 1.64 per cent to 24,982.65. The barometer had gained over 130 points in the previous session.

The 50-share NSE index Nifty cracked below the crucial 7,700-mark by plunging 128.2 points or 1.65 per cent to 7,630.60.

Brokers said the RBI’s decision to cut repo rate by 0.25 per cent to 6.5 per cent was largely in line with market expectations and failed to boost the sentiment.

They added that no change in Cash Reserve Ratio (CRR) too had its bearing.

Among rate sensitive scrips, ICICI Bank topped the list by falling 4.82 per cent, followed by SBI by 4.59 per cent, Axis Bank 2.61 per cent and HDFC Bank 0.67 per cent.

All BSE sectoral indices were trading in the red. Among them, banking index fell the most by 2.64 per cent, followed by metal 2.63 per cent, realty 2.44 per cent and capital goods 2.32 per cent.

Top five Sensex losers were Adani Ports (-5.55%), ICICI Bank (-4.82%), State Bank of India (-4.59%), Bharti Airtel (-4.1%) and Tata Motors (-3.96%), while the only two gainers were Lupin (+0.29%) and HUL (+0.03%).

Asian shares and other riskier assets skidded on Tuesday, pressured by slumping crude oil prices and mixed messages from Federal Reserve policymakers on the outlook for US interest rate rises.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 1.3 per cent. Japan’s Nikkei stock index dropped 2.1 per cent to six-week lows, as the perceived safe-haven yen rallied.

 

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