Bank shares drag India's main index down 2.9%

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Mumbai: Indian shares fell 2.9 per cent. their sharpest drop in three months, in a broad-based sell off yesterday that was led by banks such as ICICI Bank after a central bank policy tightening, and also by losses in telecoms.

The 30-share BSE index closed 400.06 points lower at 13,399.43, having earlier fallen as much as 3.9 per cent to its lowest since November 20. All 30 components lost ground.

The 50-issue Nifty fell 2.84 per cent to 3,849.50, with all 50 components ending down, and all the BSE's sector indexes also ended lower.

"This is a genuine sell-off as the market sees a threat to liquidity because of the cash reserve ratio hike for banks," said Jayesh Shroff, fund manager at SBI Mutual Fund.

"The pillar on which the index rose is under a threat so there will be more problems and this decline is likely to continue for some time," he said.

The banking index lost 6.4 per cent after Friday's announcement of an increase in bank's cash reserve ratio, the percentage of cash deposits kept with the central bank which cannot then be lent out, by 50 basis points to 5.50 per cent.

The main BSE index has fallen 4.1 per cent in the last two trading days.

 

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Bank shares drag down Sensex 400 points

Bank shares drag down Sensex 400 points

Mumbai, December 11
Sensex plunged 400.06 points to close at 13,399.43 as foreign and domestic funds hammered down banking stocks in the wake of RBI decision to hike the cash reserve ratio by 0.5 per cent last weekend.

In the broader markets Nifty plunged by 112.50 points, or 2.84 per cent at 3,849.50.

The BSE Sensex tumbled by 537.76 points during intra-day trade before recovering. Nifty, too, fell to 3,798.30 before recovering.

Expectedly banking stocks took a beating with all big scrips like HDFC, ICICI, SBI taking a plunge.

 

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BSE Bankex largest loser among the sectoral indices

Bank stocks deal body blow to Sensex party

BSE Bankex largest loser among the sectoral indices

MUMBAI, DEC 11: The Reserve Bank of India (RBI’s) move to hike the cash reserve ratio (CRR) by 50 basis points on Friday took a heavy toll on banking sector stocks, creating negative sentiments on the Dalal street on Monday. The stocks of most major public sector as well as private banks headed towards the south. Banks among the Sensex constituents -- State Bank of India, ICICI Bank and HDFC Bank -- accounted for 219 points in the index's fall of over 400 points.
Among sectoral indices, BSE Bankex lost the most: 6.43% or 463.96 points. This compares with the Sensex's loss of 2.90%.

The major losers among banks were State Bank of India that lost 8.18%, or Rs 110.75, to close at Rs 1,242.75, and ICICI Bank which lost 6.54%, or Rs 57.30, at Rs 819.40. HDFC Bank Ltd lost 4.70%, or Rs 51.05, to end the day at Rs 1,034.

Lalit Thakkar, director - research at Angel Broking, said, “We are not seeing it as a significant correction as what we have seen in May, because this fall in points today was more like a domestic trigger because of the CRR announcement. This is expected to affect the profitability of the companies and thus will hit the valuation of the equities in the long run. But the fall in Sensex will not sustain in a longer period and it might bottom out in the latter part of the day tomorrow. Long-term investors who were waiting for an opportunity like this should grab it judiciously,” Thakkar added.

The RBI’s move follows the other two important proposals that the central bank has come up with on November 3 and 17, limiting banks' exposure to an non-banking finance companies (NBFCs) and capping the banks' total exposure to capital markets.

Finance minister P Chidambaram on Monday said an increase in the CRR was to moderate the credit growth and the government was ready to take further action to curb inflation. “Banking stocks will adjust because their profitability is good. The stock market is on a high so there is no need to worry,” Chidambaram opined.
:SugarwareZ-064:

 

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Sensex plummets 490 pts; banking stocks lead declines

Sensex plummets 490 pts; banking stocks lead declines

The 30-share index has further tumbled down as sustained selling pressures is being witnessed in index heavyweights in the previous trading hour. Sectors in stocks like banking, auto and pharma led the declines.

The BSE Sensex is trading weak by 490.68 points and is ruling at 13,308.81 (1.01 p.m).

Out of the total 2,505 stocks traded at the bourses so far, 578 advanced, 1,878 declined while 49 remained unchanged.

Major losers who dragged the index down were SBI, that dipped 6.82% to Rs 1,261.15, ICICI Bank, that slipped 6.70% to Rs 818 and Tata Steel, that slid 5.91% to Rs 453.90. ACC, HDFC Bank and Reliance Energy also declined.

Gainers on the index include ONGC, which moved up 0.54% to Rs 845.05, Infosys, up 0.44% to Rs 2207 and Cipla, which gained 0.28% to Rs 247.20. TCS and Satyam were among the other gainers.

 

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Banking shares crash on CRR hike

Banking shares crash on CRR hike

Heavy sell-off by funds and retail investors in the banking shares following Reserve Bank`s decision to suck out excess liquidity from the economy, led the index down by more than 463 points, reports agency sources.

The BSE Bank index was the worst performer among the key indices with a steep fall of 463.96 points, or nearly 6.5% at 6,749.78. Heavy weighted stocks on the Sensex like State Bank of India, ICICI Bank and HDFC Bank tumbled, dragging down the benchmark Sensex by 400.06 points at 13,399.43.

The shares of country`s largest lender in the public sector, State Bank of India fell by a whopping Rs 110.75, or 8.18% at Rs 1242.75, after dipping to Rs 1,230, while Canara Bank fell by Rs 24.40 at Rs 279.10.

Other state-run banking majors, such as Oriental Bank of Commerce fell by Rs 10.95 at Rs 235.35, Bank of Baroda was down by Rs 22.20 at Rs 239.15 and Union Bank of India lost Rs 7.70 at Rs 120.25.

Banking giants in the private sector like ICICI Bank plunged by Rs 57.30 at Rs 819.40, HDFC Bank by Rs 51.05 at Rs 1034, UTI Bank by Rs 21.45 at Rs 443.55, and Kotak Mahindra Bank by Rs 8.90 at Rs 380.95