Sensex dives 516 pts, Nifty ends at 7603 post RBI policy

Moneycontrol Bureau3:30 pm Market Closing: Equity benchmarks crashed 2 percent today due to slump in global peers and post RBI monetary policy.The Sensex shed 516.06 points to 24883.59 and the Nifty fell 155.60 points to 7603.20. About two shares declined for every share advancing on BSE.ICICI Bank, Infosys, Tata Motors, SBI, Adani Ports and L&T were top five contributors to Sensex's fall, down 2-6 percent while only Lupin closed in green.3:20 pm RBI's new guidelines soon: Concerned over rising bad loans, the Reserve Bank will soon come out with a draft framework on large exposure of bank loans to corporates.

"Taking into account the views and suggestions from stakeholders on the discussion paper on 'Large Exposures Framework and Enhancing Credit Supply through Market Mechanism', a fresh discussion paper will be issued by April 30, 2016 on large borrowers meeting part of their funding requirements from markets," RBI Governor Raghuram Rajan said.

A draft circular on the Large Exposures Framework will be issued for public comments in June 2016, which is to be implemented by January 1, 2019, he said, after unveiling the first bi-monthly monetary policy review for 2016-17.

In order to promote start-ups in the country, RBI will also release norms with respect to deferred payment.3:10 pm Market Update: The Sensex extended losses in last hour of trade, falling 507.28 points or 2 percent to 24892.37. The Nifty declined 151.20 points or 1.95 percent to 7607.60.3:05 pm Fitch on Rolta: Fitch Ratings has downgraded Rolta India's long-term foreign- and local-currency issuer default ratings (IDRs) to 'B' from 'BB-', saying the outlook is negative. The stock lost 2 percent.Simultaneously, Fitch has downgraded ratings on the Rolta LLC's USD127 million 10.75% senior unsecured notes due 2018 and Rolta Americas LLC's USD 367 million 8.875% senior unsecured notes due 2019, and Rolta's senior unsecured rating to 'B' from 'BB-' and assigned recovery ratings of 'RR4'. The notes are guaranteed by Rolta."The downgrade reflects our expectations that Rolta's leverage and liquidity will weaken due to lower-than-expected cash generation and high receivable days," says the rating agency.2:59 pm Market Update: Equity benchmarks continued to see selling pressure. The Sensex fell 439.95 points or 1.73 percent to 24959.70 and the Nifty declined 129.95 points or 1.67 percent to 7628.85.2:53 pm NH exits hospital operations: Narayana Hrudayalaya has decided to cease operations at its Malla Reddy Narayana Multispecialty Hospital in Hyderabad, Telengana.It entered into an agreement to sell undertaking to Chandramma Educational Society.The hospital was commissioned in July 2010 on a 20-year lease with Chandramma Educational Society.

2:45 pm Buzzing: VLS Finance shares rallied 20 percent intraday after offloading major shareholding in Relaxo Footwears.

The company has garnered Rs 75.3 crore by selling 17.7 lakh equity shares of Relaxo Footwears through a block deal on National Stock Exchange. It sold shares at Rs 425 apiece in previous session.

On the other side, Jwalamukhi Investment Holdings was the buyer, who purchased 18.66 lakh shares of Relaxo.

Before this block deal, VLS was the major public shareholder in the company.2:35 pm NSE mock trading: Leading bourse National Stock Exchange (NSE) will conduct mock as well as live trading sessions from its disaster recovery site. The mock trading will be conducted on April 9 while live trading will be on April 11 and April 12, NSE said in a circular. The exchange has an advanced arrangement to avoid any form of change or interruption in future.

A disaster recovery (DR) site is necessary for all critical institutions like exchanges so that operations can be done seamlessly and smoothly if any extraneous event affects the functioning of the main trading centre in Mumbai. The exchange has asked its members "to participate actively in the mock trading session to check the connectivity and avoid login problems in live trading sessions from DR site".2:30 pm HAL turnover at record high: Defence PSU Hindustan Aeronautics Limited (HAL) today said its turnover surged to an all-time high of Rs 16,524 crore for fiscal 2015-16. Besides, the company's exports stood at Rs 401 crore for the year."It is an all-time high with PBT (profit before tax) standing at Rs 3,210 crore for the year," HAL Chairman and Managing Director T Suvarna Raju said in a company release.

The company had achieved a turnover of Rs 15,622 crore for fiscal 2014-15 and PBT of Rs 3,173 crore. He said all 12 Su-30 MKI aircraft produced during the year were from raw material phase, while production of 17 Hawk aircraft is the highest ever achieved in a year.2:20 pm FinMin on RBI policy: Finance Ministry today said RBI's policy rate cut will provide a "good stimulus" to the economy and encourage banks to reduce lending rates.

"RBI actions today are very welcome. Obviously we believe that the rate cut which has been effective would be very good stimulus for the economy," Minister of State for Finance Jayant Sinha told reporters here.

The Reserve Bank in its first bi-monthly monetary policy review today cut interest rate by 0.25 percent and introduced a host of measures to smoothen liquidity supply so that banks can lend to the productive sectors and indicated accommodative stance going ahead.

"Some of the banks have already reset their interest rates taking into account the marginal cost of lending and done some amount of reduction of rates consequent to all these measures and consequent to RBI's announcement today the banks will perhaps need to do some more transmission of reduction of policy rates of RBI," Economic Affairs Secretary Shaktikanta Das said.2:10 pm IMF on India: With strong growth and rising real income, India remains a bright spot in the global economy, IMF chief Christine Lagarde said today.

In her major policy address, Lagarde said overall, the global outlook has weakened further over the last six months exacerbated by China's relative slowdown, lower commodity prices and the prospect of financial tightening for many countries.

Emerging markets had largely driven the recovery and the expectation was that the advanced economies would pick up the "growth baton".

"That has not happened," the International Monetary Fund (IMF) Managing Director said in her address 'Decisive action to secure durable growth' at Goethe University, Frankfurt in Germany.

While emerging markets are a very diverse group, the story is broadly similar. China's transition to a more sustainable economic model which is good for China and the world means that its growth rate, while still strong, is lower. Downturns in Brazil and Russia are larger than expected, she said.Also read - Inflation could rise on bad monsoon, currency decline: Moody's

2:00 pm Market Check

Further selling in banks & auto stocks drove the market down by 1.8 percent in afternoon trade after RBI monetary policy, tracking weakness in global peers post slump in commodities.

The 30-share BSE Sensex cracked 450.84 points or 1.77 percent to 24948.81 and the 50-share NSE Nifty plunged 139.60 points or 1.80 percent to 7619.20. The BSE Midcap and Smallcap indices were down 1.4 percent each.

The market breadth remained weak as about 1663 shares declined against 703 advancing shares on Bombay Stock Exchange.ICICI Bank, SBI, Hindalco Industries, Adani Ports, Bharti Airtel and Tata Motors topped selling list on Sensex, down 4-5 percent followed by Infosys, L&T, Axis Bank, M&M, Maruti, Coal India, GAIL and BHEL with 2-3 percent loss.