Rate cut fails to bolster markets

Mumbai: Indian stock markets on Tuesday registered steepest fall in recent weeks as investors were not too enthused by the Reserve Bank’s modest 25 bps rate cut. Global cues did not help either, further denting market sentiment.
Market benchmark Sensex plunged by 516 points, most in nearly two months, to crack below the 25,000-mark, with banking stocks taking a big knock, while Nifty shed 155.60 points. Participants said no change in Cash Reserve Ratio (CRR), also had its bearing on the sentiment. The sell-off was so intense that barring Lupin, all 30 Sensex shares ended in the red and lost up to 6.23 per cent. Broader markets were also lower with mid-cap index falling 1.47 per cent and small-cap down 1.40 per cent. Sensex resumed lower at 25,372.44 and fell further to a low of 24,837.51 before finishing at 24,883.59, showing a loss of 516.06 points of 2.03 per cent. The Sensex touched a high of 25,372.44 points and a low of 24,837.51 points during the intra-day trade.This was index’s biggest single-day fall since February 11. The NSE index Nifty after dipping below the psychological 7,600-mark, touched a low of 7,588.65, before settling 155.60 points or 2.01 per cent at 7,603.20.
Among rate-sensitive stocks on BSE, ICICI Bank topped the list by tumbling 5.45 per cent followed by SBI 5.38 per cent, Axis Bank 2.89 per cent, HDFC Bank 1.03 per cent and HDFC 0.07 per cent. Realty and auto stocks suffered too. The BSE market breadth was heavily tilted in favour of bears - with 1,630 declines and 884 advances.
Overseas, Japanese stocks led decline in Asian markets on uncertainty regarding the quantum and timing of interest rate hikes in the US. Japan’s Nikkei closed 2.42 per cent lower, while indices in Hong Kong, Singapore and South Korea dropped between 0.82 per cent and 1.57 per cent. China bucked the trend to end 1.45 per cent higher. Europe was lower as volatility in oil price continued to weigh. Key indices in France, Germany and the UK fell by 1.45 per cent to 2.61 per cent.