 "Banking shares under pressure ahead of RBI meet")
Banking shares are under pressure on the bourses ahead of the Reserve Bank of India's monetary policy review on Tuesday.
State Bank of India, Union Bank of India, Bank of Baroda, Punjab National Bank, IndusInd Bank, YES Bank and Canara Bank are down 2-6% on the National Stock Exchange (NSE). The NSE banking share index Bank Nifty was down 0.87% compared to 0.51% decline in benchmark CNX Nifty at 1455 hours.
State Bank of India, Union Bank of India, Bank of Baroda, Punjab National Bank, IndusInd Bank, YES Bank and Canara Bank are down 2-6% on the National Stock Exchange (NSE). The NSE banking share index Bank Nifty was down 0.87% compared to 0.51% decline in benchmark CNX Nifty at 1455 hours.
Most of the market analysts expect the central bank may hike repo rate further in tomorrow’s policy meet.
“The street feels hiking repo rate by 25 bps to 7.75% and simultaneously cutting MSF rate by the same magnitude to 8.75% is the most probable outcome,” the Business Standard report suggests.
“Given persistent inflationary pressure at the consumer level and uptick in inflation at the wholesale level, RBI is expected to increase repo rate in Oct 29 monetary policy by 25bps. Further, the market expects a further 50 bps reduction in the MSF rate” says Amar Ambani, head of research at IIFL said.
Among the individual stocks, Union Bank of India has dipped 6% on NSE followed by Bank of Baroda (down 4%); Punjab and National Bank and IndusInd Bank are down 3% each, while SBI and Canara Bank are down 2% each.