Indian stock markets on Thursday edged lower as the BSE Sensex plunged over 553.82 points, closing at 39,529.72, while the Nifty also dived 177.90 points at 11,843.75 after the Reserve Bank of India cut repo rate by 25 basis points to 5.75%.
Hindustan Unilever, Coal India, Hero MotoCorp, National Thermal Power Corporation and Power Grid Corporation were among the top gainers on the key indices, whereas the losses were led by banking and financial stocks. Tata Motors Ltd - DVR, Larsen & Toubro, IndusInd Bank, State Bank of India, and Yes Bank contributed the most to the losses on the Sensex.
The midcap and smallcap indices also plunged over 1%.
“While the rate cut of 25 basis points was in line with our expectation, concerns over growth and challenges regarding liquidity continue to linger,” Naveen Kulkarni, head of research, Reliance Securities told CNBC TV18. “The market is not necessarily cheering the rate cut as it had already factored in and something more was expected.”
The rupee, which had weakened to 69.36 against the dollar ahead of the RBI decision, strengthened to 69.30. This was still weaker than the previous close of 69.265.