Shares fall as govt lowers FY13 GDP estimate ahead of policy review
In its mid-year review, the finance ministry said the economy may grow 5.7-5.9% in the current fiscal against an earlier estimate of 7.85%.
Traders say the growth revision was in line with the RBI's outlook on the economic expansion this fiscal and, hence, may not prompt it to cut interest rate as yet. However, tightened liquidity due to advance tax outgo and muted deposit growth is expected to force the RBI into considering another round of CRR cut.
Based on these expectations, interest-rate sensitive stocks from the banking and realty spaces rallied. SBI, PNB and ICICI Bank were the gainers among the big banks, rising 0.7-1%. Canara Bank and Yes Bank rallied more than 1%, while Union Bank rose 3.3% to R274. Maruti Suzuki and Tata Power were the blue chip gainers from the Nifty, rising 1.5% each. DB Realty rose as much 7.7%. The mid- and small-cap indices also mirrored market momentum by advancing 0.6% and 0.5%, respectively.
Metal stocks gained strength after China, at the end of an annual economic conference, said it will increase urbanisation to boost domestic consumption.
Sesa Goa and JSPL led the rally of blue
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