Markets end lower on surprise RBI rate hike; Sensex ends below 56K, Nifty falls below 16,700

4 May 2022 , 03:57 PM

Equity benchmark indices on Wednesday plunged sharply after RBI’s surprise move on increasing the repo rates today an acknowledgement of inflation becoming a more important variable in policy decisions than growth. Moreover, earnings results, the Russia-Ukraine war and surging COVID-19 cases continue to remain in focus.

Reserve Bank of India (RBI) raised the repo rate by 40 basis points (bps) to 4.40 per cent in an off-cycle meeting today. Repo rate is the rate at which a central bank lends money to banks.

The 30-share BSE Sensex tanked 1,307 or 2.29 per cent to close at 55,669, while the broader NSE Nifty crashed 392 points or 2.29 per cent at 16,678. Broader markets moved largely in tandem with the main indices as Nifty MidCap and Nifty SmallCap fell 2.1% and 2.4% respectively.

All sectoral indices ended in red. Nifty Media was the biggest laggard which plummeted 4.3%, followed by Nifty Reality and Nifty Metal which were down ~3.2% each.

The overall market breadth on BSE stood negative as 864 shares were advancing while 2,508 were declining.

Bajaj Finserv, Bajaj Finance, Titan, IndusInd Bank, HDFC Bank, Reliance Industries, Asian Paints, Maruti, Dr Reddy’s and Axis Bank were among the top laggards. On the flip side, PowerGrid, NTPC, and Kotak Mahindra Bank were trading in the green.

Meanwhile, LIC’s initial share sale witnessed strong participation from policyholders and retail investors. The IPO is subscribed by 57 per cent on the first day of bidding.