Ahead of RBI’s policy announcement tomorrow, the BSE Sensex dropped down 109 points and closed below-35,000 mark on Tuesday.
Amid speculation that it may hike the key interest rate for the first time since January 2014 due to firming inflation, the Reserve Bank of India’s three-day monetary policy review meeting kicked off yesterday.
As per the Deccan Chronicle, The gauge had lost 310.49 points in the previous two sessions. The broader NSE Nifty too dropped by 35.35 points, or 0.33 per cent, to end at 10,593.15, after moving between 10,633.15 and 10,550.90. Interest rate sensitive realty, banking and auto stocks remained under pressure.
The trading mood was also impacted after PMI data showed that India’s services activity contracted for the first time in three months in May as new business orders stagnated and cost pressure intensified amid higher fuel prices.