Rate-sensitive stocks trade lower after it hikes
repo rate by 25 bps to 6.5%
The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) decided to hike rates by 25 basis points to 6.5 percent.
Shares of rate-sensitive stocks were trading lower after the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) decided to hike rates by 25 basis points to 6.5 percent.Sectors such as banking, real estate, and auto, among others, are usually impacted by a rate hike as the cost of the products will be directly influenced due to increase in interest rate.
The Bank Nifty was trading lower, with stocks such as Yes Bank, Federal Bank, and HDFC Bank, among others in the red. IndusInd Bank and Kotak Bank were trading in the green.
There was some upmove visible among financial services. The likes of IIFL, Max Financial Services, Shriram Transport, Bajaj Finance, Edelweiss were all up around 2 percent.
Meanwhile, PSU banks were trading lower after the central bank’s announcement. The likes of IDBI, Union Bank of India, PNB, and Bank of India were in the green, but weakness was seen in other major names such as OBC, Syndicate Bank, Andhra Bank, State Bank of India and Allahabad Bank, among others.
Auto names were trading in the red too. A nifty Auto index was up down around a percent. Shares of Ashok Leyland, Bharat Forge, Apollo Tyres, Amara Raja Batteries, and TVS Motor, among others are higher, while Hero Moto, Tata Motors and Maruti are in the red.
Realty stocks, a part of the rate-sensitive pack, reacted positively to the development, with the Nifty Index realty index trading over 0.10 percent higher. Phoenix Mills, Prestige Estates and Brigade Enterprises, and Sobha were up up to 4 percent, while the likes of Oberoi Realty, DLF, Indiabulls Real Estate traded down 1-2 percent.