Banks and realty stocks tank after rates remain unchanged

Paring initial gains, rate-sensitive banking and realty stocks today fell by around 3 percent on RBI’s decision to keep all key interest rates unchanged.

Financial stocks were the worst hit, with SBI trading lower by 3.30 percent at Rs 2,110.70, followed by HDFC Bank which lost 2.71 percent to Rs 533 on the BSE. ICICI Bank plunged 2.60 per cent, while PNB was down 2.32 percent, Bank of India slipped 2.94 per cent and Axis Bank fell by 2.7 percent.

Following the losses in these stocks, the BSE Bankex index was trading 2.55 percent down at 11,291.39 and was the biggest loser among the 13 sectoral indices. Among the realty stocks, DLF tanked 3.33 percent, Unitech was down 3.49 percent and Sobha Developers lost 2.03 percent.

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 Led by losses in these stocks, the BSE realty index shed 2.10 percent to quote at 1,588.73. The Reserve Bank today kept policy rates unchanged in view of rising inflation and global economic uncertainty.Besides, the central bank also kept cash reserve ratio (CRR) or the percentage of deposits that banks have to keep with RBI unchanged at 4.75 percent.

After the RBI policy announcement, the BSE 30-scrip index, Sensex, fell by over 200 points to below 17,000-mark it had crossed in the morning trade.

Marketmen were expecting the RBI to cut the lending rate (repo) by at least 0.25 percent and were also looking forward to further cut in CRR to infuse more liquidity in the financial system.

PTI