Nifty slips further post RBI policy; banks, telecom dip

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At 11:52 hours IST, though the RBI (Reserve Bank of India) kept CRR, Repo Rate and Reverse Repo Rate unchanged, the Nifty slipped further. RBI maintained a hawkish stance in the credit policy.

The sell-off in shares of telecom, metal, realty, banking and private power companies along with Reliance Industries was putting pressure on the markets. However, buying in technology, select auto stocks, and L&T, ONGC, Sun Pharma and Grasim capped the losses to some extent.

In the credit policy, the RBI tightened NPA (non-performing asset) norms for banks and reduced FY10 credit growth projection to 18% from 20%. SLR (Statutory Liquidity Ratio) increased to 25% from 24%, which is not going to impact liquidity, RBI said.

Inflation for March 31, 2010 revised to 6.5% from 5% and FY10 GDP forecast remained unchanged at 6% with upward bias. Real estate provision hiked to 1% from 0.4%.

The Nifty was down 56 points at 4,914 and the Sensex fell 164 points to 16,575. The broader indices slipped 1.6-2%. The market breadth widened its gap; about 201 shares advanced while 1,038 shares declined on the NSE. 

In largecaps, DLF, Sterlite Industries, SBI, Bharti Airtel, Reliance Communication, Unitech and IDFC fell 3.5-6.5%. However, Wipro, Tata Motors, Sun Pharma, M&M and Grasim gained 1-3.5%.

In the midcap space, PTC India, MindTree, Cadila Health, Balrampur Chini and Bannariamman went up 1-3% while HDIL, Indiabulls Real, OnMobile Global, HCL Info and Puravankara Projects fell 6.5-8.5%.

In the smallcap space, Navin Fluorine, Prime Securitie, Sujana Towers, Hinduja Global and Fem Care Pharma gained 4-10% while Aptech, MIC Electronics, Mercator Lines, Hatsun Agro and India Glycols declined 8-14.5%.

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