Markets ignore rate hike

Markets are trading on a firm note post the Reserve Bank of India's policy review as the hike was in line with the street's expectations. The Sensex was at 17,050, up 173 points and the S&P CNX Nifty was at 5,117, higher by 42 points.

The RBI with an aim to control the spiralling inflation maintained its hawkish stance and hiked the key rates by 25 basis points. The repo rate now stands at 8.25% and the reverse repo rate is at 7.25% while the cash reserve ratio or CRR is kept unchanged at 6%.

Back to markets, most of the Sensex stocks were trading higher. Tata Motors was the top gainer among the Sensex stocks, up 6.5% to Rs 161. ONGC gained 5.6% to Rs 275 after the government decided to put ONGC's FPO on hold. Sterlite Industries, Tata Power, Hindalco, NTPC, Larsen & Toubro, HDFC, Maruti Suzuki, SBI, TCS and ICICI Bank also added 1-3.6% in trades thus far.

On the other hand, HUL, J P Associates, Bharti Airtel, Infosys, Bajaj Auto and BHEL were among the notable losers on the benchmark index.

All the sectoral indices were trading higher, BSE PSU index was the top gainer, up nearly 2% or 137 points to 7,771. Auto index added 1.6% to 8,871. Oil & Gas index also advanced 1.6% or 137 points to 8,866. Rate sensitive sectors such as banking and realty slipped marginally into the red but soon recovered from the low levels. Bankex advanced nearly 1% or 97 points to 11,158 and the Realty index was at 1,787, up nearly 0.5%. Capital Goods, Metal and Power indices were also among the top gainers.

ONGC, Hindustan Copper, NMDC, Dredging Corp, United Bank, Union Bank of India, STC and MMTC were the top gainers among the PSU stocks. Among the auto stocks Tata Motors was the top gainer. It was followed by Maruti Suzuki, Ashok Leyland, Mahindra & Mahindra and Hero MotoCorp.

The broader markets were trading on a flat note. The BSE mid-cap index gained 28 points to 6,395 and the small-cap index advanced 12 points to 7,226.

The overall breadth was marginally positive as 1,343 stocks advanced while 1,215 stocks declined.