Sensex opens in red on hawkish RBI; Bharti up 3% on stake sale

The Indian equity markets opened in the red ahead of key RBI policy review at 11 am. The Reserve Bank of India on Thursday warned of “very limited” space for further easing of monetary policy, striking a hawkish tone a day before it is widely expected to cut interest rates by 25 basis points for the third time this year.

Sensex opened at 19697.87, down 0.19 percent and the Nifty opened at 5985.85, down 0.23 percent.

The cautious language in its report on macroeconomic and monetary developments could dent rising market hopes for a dovish stance from RBI governor D Subbarao on Friday and further easing this year.

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Globally, Asian shares rose on Friday after an interest rate cut by the European Central Bank added to hopes that more stimulus from yet another major central bank will help shore up the global economic recovery.

ECB President Mario Draghi also said the ECB stood ready to ease further if needed, dealing a blow to the euro currency as investors looked elsewhere for better returns.

Additionally, brokerage Credit Suisse today said it is retaining its “overweight” call on domestic stock markets despite the risks emanating from forthcoming general elections and said it sees a full 10 per cent upside this year.

Stocks in news

Kingfisher Airlines opened down 1 percent after banks invoked Mallya’s personal guarantees**.**

RIL opened down 0.31 percent after Sebi fined RIL entity Rs 11 crore in insider trading case

Bharti Airtel opened up 3 percent after it said it would sell a 5 percent stake in the company to Qatar Foundation Endowment for $1.26 billion.