MUMBAI (Reuters) - India's stock markets ended higher on Tuesday, reversing losses of more than 1 percent earlier in the session, after the Reserve Bank of India (RBI) surprised the street with a bigger-than-expected rate cut.
The central bank cut its key repo rate by a larger-than-expected 50 basis points to 6.75 percent on Tuesday, with inflation running at record lows and the economy in danger of slowing down.
Only one out of 51 economists and analysts polled by Reuters last week expected a 50-basis-point cut while 45 expected the RBI to cut the repo rate by 25 basis points.
The benchmark Sensex ended 0.63 percent higher, after recovering from a 1.29 percent fall, but was up as much as 1.71 percent during the day.
The broader Nifty gained 0.61 percent at close. It rose as much as 1.68 percent after falling as low as 1.34 percent.
(Reporting by Karen Rebelo in Mumbai; Editing by Sunil Nair)
