Rate sensitive stocks such as banks, realty and capital goods stocks witnessed profit booking in mid-morning trade on Friday ahead of the Reserve Bank of India’s (RBI) policy meet due later today.
All eyes are on new RBI Governor Raghuram Rajan who will come out with his maiden monetary policy review later today. The monetary policy announcement is due at 11 am on Friday. Rajan took over as governor on September 4.
“Most bankers expect RBI to maintain status-quo on policy rates, cash reserve ratio (CRR),” according to an ET Now Poll. They also expect partial rollback of liquidity tightening steps.
Given the current dovish outlook and the appreciation of the rupee and other Asian currencies following the announcement, most Indian financial market participants expect a lowering in the marginal standing facility (MSF) rate and the daily cash reserve balance requirement.
Banking stocks which outshined others in an overall buoyant market on Thursday witnessed bouts of profit booking, led by losses in Yes Bank, IndusInd BankBSE 0.83 %, ICICI BankBSE 1.01 % and Bank of Baroda.
Yes Bank which skyrocketed over 22 per cent to Rs 386.80 and was the top gainer in the S&P BSE Banking index slipped 3.4 per cent to Rs 373.15 at 09:40 a.m.
Other stocks in the BSE Banking index such as Bank of Baroda, IndusInd Bank and ICICI Bank were trading 1-2 per cent lower.
Realty stocks also came under pressure with the BSE Realty index down 0.8 per cent, led by losses in DB Realty which was down 1.6 per cent, DLF plunged 1.08 per cent; while Sobha Developers and Unitech were trading 0.5 per cent lower.
The BSE Capital Goods Index was trading 1.3 per cent lower, led by losses in Sadbhav Engineering which was down 4.6 per cent, Welspun Corp plunged 2.9 per cent and Bharat Electronics was down 1.8 per cent.
While BHEL, L&T and Suzlon were trading nearly 1 per cent lower.
Source: Economic Times
