RBI policy review subdues markets; Sensex closes 244 points down (Third Lead)

Mumbai, Sep 28 (IANS) With investor sentiments turning bearish a day ahead of the fourth bi-monthly monetary policy review of the Reserve Bank of India (RBI), a barometer index of Indian equities provisionally closed 244 points down on Monday.

The markets were dragged down by the uncertainty over the RBI’s rate cut decision. The apex bank will conduct its fourth bi-monthly monetary policy review on September 29.

The barometer 30-scrip sensitive index (S&P Sensex) of the Bombay Stock Exchange (BSE) closed on Thursday (Sep 24) with a gain of only 39 points or 0.15 percent. On Friday, the Indian markets remained closed on account of Eid-ul-Zuha.

The Indian equity markets opened on a lower note on Monday, following a sharp downward revision of Chinese industrial profits.

On Monday, the wider 50-scrip Nifty of the National Stock Exchange (NSE) too provisionally closed in the red. It shed 67.25 points or 0.85 percent at 7,801.25 points.

The S&P BSE Sensex, which opened at 25,922.71 points, provisionally closed at 25,619.89 points (at 3.30 p.m.) — 243.61 points or 0.94 percent down from the previous day’s close at 25,863.50 points.

The Sensex touched a high of 25,936.89 points and a low of 25,593.56 points in the intra-day trade.

Observers pointed out that negative Asian market cues coupled with anxiety over the upcoming monetary policy review subdued Indian markets.

“Chinese data showing that industrial profits declined steeply did give a negative opening to Indian markets, but the Chinese story drew no surprises,” Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.

“With crucial RBI rate decision to be announced tomorrow (Tuesday), markets looked visibly cautious.”

Nitasha Shankar, vice president of research with YES Securities, said: “Market participants preferred to maintain light trading positions in the run-up to the RBI policy meet.”

“Metal and auto stocks dragged the index lower.”

Sector-wise, automobile, capital goods, metal, information technology (IT) and banking stocks came under heavy selling pressure.

However, consumer durables, healthcare and realty sectors supported the markets.

The S&P BSE automobile index plunged by 318.95 points, capital goods index receded by 286.64 points, metal index declined by 196.20 points, IT index was lower by 131.15 points, and banking index fell by 91.26 points.

However, the S&P BSE consumer durables index augmented by 284.68 points, healthcare index gained 21.77 points and realty index rose by 16.11 points.

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