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The Economic Times

Sensex slumps 700 pts from day high as RBI slashes growth forecast

Benchmark equity market plunged after the Reserve Bank of India (RBI) slashed the repo rate by 25 basis points to 5.15 per cent.

The central bank also cut the GDP growth forecast for the current financial year to 6.10 per cent from 6.90 per cent earlier.

The BSE Sensex dived after gaining over 200 points in early trade. At 1408 hours, it was trading with a loss of 250 points around 38,850-level after the policy announcement. NSE barometer Nifty also cut 89 points to trade around 11,220.

Rate-sensitive counters were mixed. The BSE Auto index was up 0.54 per cent at 16,846 with Ashok Leyland gaining the most 4.36 per cent. Hero MotoCorp, Mahindra & Mahindra, Bajaj Auto and Maruti were up over 0.50 per cent.

On the other hand, the BSE Bankex and Realty index were down 0.20 per cent and 0.33 per cent, respectively.

Majority of stock in Sensex pack were trading in the green with ONGC gaining the most 2.65 per cent. It was followed by NTPC (up 1.93 per cent), IndusInd Bank (up 1.70 per cent), HDFC (up 1.68 per cent) and Hero MotoCorp (1.44 per cent).

The Reserve Bank of India maintained accommodative policy stance with a view to revive growth.

“All members of the MPC voted to reduce the policy repo rate and to continue with the accommodative stance of monetary policy. Chetan Ghate, Pami Dua, Michael Debabrata Patra, Bibhu Prasad Kanungo and Shaktikanta Das voted to reduce the repo rate by 25 basis points. Ravindra H Dholakia voted to reduce the repo rate by 40 basis points,” RBI said in a release.
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