MUMBAI: Rate sensitive sectors were witnessing a sell-off after the Reserve Bank of India hiked the repo and reverse repo rate by 50 basis points each. According to experts, these sectors are likely to remain under pressure in the near term.
"50 basis points hike by the RBI was a disappointment for the market. Reward for investors won't be very high in rate sensitive stocks and bearish on these stocks in the near term. The rate hike will hurt companies without pricing power," said Ramdeo Agarwal, co-founder and director, Motilal Oswal on ET Now.
He added that real danger for banks will be slow-down in credit growth. He gas advised to be selective in picking PSU banks pack.
Meanwhile, the rate sensitive sectors were dragging down the indices. BSE Auto Index was down 2.16 per cent, BSE Bankex fell 1.97 per cent and BSE Realty Index slipped 1.46 per cent.
M&M (-3.77%), Tata Motors (-2.87%), Bajaj Auto (-2.56%) and Maruti Suzuki (-2.28%) were the top losesrs from BSE Auto Index.
The worst hit in banking space were Canara Bank (-3.85%), Punjab National Bank (-3.57%), Axis Bank (-2.89%) and State Bank of India (-2.88%).
Realty space was also reeling under selling pressure. DB Realty (-2.50%), HDIL (-2.49%), Mahindra Lifespace (-1.99%) and Peninsula Land (-1.97%) were the major losers.
"50 basis points hike by the RBI was a disappointment for the market. Reward for investors won't be very high in rate sensitive stocks and bearish on these stocks in the near term. The rate hike will hurt companies without pricing power," said Ramdeo Agarwal, co-founder and director, Motilal Oswal on ET Now.
He added that real danger for banks will be slow-down in credit growth. He gas advised to be selective in picking PSU banks pack.
Meanwhile, the rate sensitive sectors were dragging down the indices. BSE Auto Index was down 2.16 per cent, BSE Bankex fell 1.97 per cent and BSE Realty Index slipped 1.46 per cent.
M&M (-3.77%), Tata Motors (-2.87%), Bajaj Auto (-2.56%) and Maruti Suzuki (-2.28%) were the top losesrs from BSE Auto Index.
The worst hit in banking space were Canara Bank (-3.85%), Punjab National Bank (-3.57%), Axis Bank (-2.89%) and State Bank of India (-2.88%).
Realty space was also reeling under selling pressure. DB Realty (-2.50%), HDIL (-2.49%), Mahindra Lifespace (-1.99%) and Peninsula Land (-1.97%) were the major losers.
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