Sensex drops 1527 pts as banks drag

The key equity indices extended early losses in morning trade. Banks stocks tumbled for the second consecutive session. At 10:22 IST, the barometer index, the S&P BSE Sensex, was down 1526.82 points or 2.81% to 52,776.62. The Nifty 50 index tumbled 442.60 points or 2.73% at 15,759.20.

Global cues were weak as investors shunned risky assets on worries that aggressive interest rate hikes by global central banks would stifle economic growth. On Friday, US government data showed inflation reached 8.6% in the 12 months ended in May, the steepest rise in consumer prices since December 1981.

In the broader market, the S&P BSE Mid-Cap index fell 2.36% while the S&P BSE Small-Cap index declined 2.53%.

The market breadth, indicating the overall health of the market, was weak. On the BSE, 552 shares rose and 2595 shares fell. A total of 112 shares were unchanged.

Economy:

Industrial activity in April jumped 7.1% year on year, according to the index of industrial production (IIP) data released by the government on Friday. In comparison, industrial growth had expanded 1.9% in March. Growth in the mining sector was 7.8% in April 2022. The manufacturing sector expanded by 6.3%. Power sector showed a growth of 11.8% year on year in April 2022.

Buzzing Index:

The Nifty Bank index fell 3.49% to 33,279.15. The index has declined 5.15% in two sessions.

Among the index components, ICICI Bank (down 3.99%), IndusInd Bank (down 3.68%), State Bank of India (down 3.55%), and Kotak Mahindra Bank (down 3.45%) were the top losers.

Among the other losers were Bandhan Bank (down 3.45%), IDFC First Bank (down 3.23%), Federal Bank (down 3.22%), Axis Bank (down 2.78%), and HDFC Bank (down 2.66%).

Jammu and Kashmir Bank slipped 2.62%. The bank`s board on 10 June 2022 approved the appointment of Pratik D Punjabi as the chief financial officer of the bank.

Bank of Baroda tumbled 4.38%. The state-run bank on Friday announced an increase in the marginal cost of funds-based lending rate (MCLR) by 10-20 basis points across different tenors, effective from 12 June 2022.

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