MUMBAI: The Bombay Stock Exchange's Sensex plunged to fresh 52-week lows as institutional investors booked profits across the board on renewed domestic growth concerns after the Reserve Bank of India policy review failed to boost sentiments.
The RBI in its much awaited meet kept the key interest rates unchanged in line with market expectations. Repo rate is kept at 8.5 per cent, reverse repo rate continues to be 7.5 per cent and CRR left unchanged at 6 per cent.
Commenting on rate cuts, the RBI Governor D Subbrao said he cannot speculate when the cuts will begin and added that "rate cut is an event some way ahead."
The RBI gave official confirmation to end of rate hikes by stating, "From this point on, monetary policyactions are likely to reverse the cycle, responding to the risks to growth".
However, the uncertainty over the beginning of reversal of rate cycle kept the wary investors jittery. The FIIs have been flocking to less riskier assets as slow-down in domestic economic growth, high inflation and interest rates has been putting pressure on the Indian markets.
As a result, the Indian rupee has been hitting fresh lows against the US dollar. However, the Indian rupee bounced back after four-days of weakness on RBI's intervention. The partially convertible rupee was at 52.67 per dollar, up 0.97 paise or 1.81 per cent.
The market had opened higher and gained momentum ahead of the RBI policy but capitulated in the afternoon. The last hour of trade witnessed sharp selling pressure on huge volumes as benchmarks closed below crucial levels. According to analysts, the breach of strong support levels on closing basis is an indication of further downside in next few weeks.
The Sensex ended at 15491.35, down 345.12 points or 2.18 per cent. The 30-share index touched intraday low of 15425.20 and high of 16068.90.
The National Stock Exchange's Nifty closed at 4651.60, down 94.75 points or 2 per cent. The broader index touched a high of 4818.85 and low of 4628.20 in trade today.
"There could be more momentum on the downside. There are still 2 weeks to go before the expiry on this month. While the market was closing, you could actually see a lot of shorts pile on and Nifty actually close 20 points in discount and Bank Nifty 40 odd points in discount.
The RBI in its much awaited meet kept the key interest rates unchanged in line with market expectations. Repo rate is kept at 8.5 per cent, reverse repo rate continues to be 7.5 per cent and CRR left unchanged at 6 per cent.
Commenting on rate cuts, the RBI Governor D Subbrao said he cannot speculate when the cuts will begin and added that "rate cut is an event some way ahead."
The RBI gave official confirmation to end of rate hikes by stating, "From this point on, monetary policyactions are likely to reverse the cycle, responding to the risks to growth".
However, the uncertainty over the beginning of reversal of rate cycle kept the wary investors jittery. The FIIs have been flocking to less riskier assets as slow-down in domestic economic growth, high inflation and interest rates has been putting pressure on the Indian markets.
As a result, the Indian rupee has been hitting fresh lows against the US dollar. However, the Indian rupee bounced back after four-days of weakness on RBI's intervention. The partially convertible rupee was at 52.67 per dollar, up 0.97 paise or 1.81 per cent.
The market had opened higher and gained momentum ahead of the RBI policy but capitulated in the afternoon. The last hour of trade witnessed sharp selling pressure on huge volumes as benchmarks closed below crucial levels. According to analysts, the breach of strong support levels on closing basis is an indication of further downside in next few weeks.
The Sensex ended at 15491.35, down 345.12 points or 2.18 per cent. The 30-share index touched intraday low of 15425.20 and high of 16068.90.
The National Stock Exchange's Nifty closed at 4651.60, down 94.75 points or 2 per cent. The broader index touched a high of 4818.85 and low of 4628.20 in trade today.
"There could be more momentum on the downside. There are still 2 weeks to go before the expiry on this month. While the market was closing, you could actually see a lot of shorts pile on and Nifty actually close 20 points in discount and Bank Nifty 40 odd points in discount.
(Source- http://economictimes.indiatimes.com)
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