1 hr ago
Rate-Sensitive Shares Slide as October RBI Hike Bets Rise
Some Indian stocks fell because investors worried that interest rates may go up soon.
Analysts said an October rate increase of 25 basis points is becoming more likely.
The concern grew because the Reserve Bank of India has been removing money from the financial system.
Higher oil prices could also encourage more rate increases.
Real-estate companies fell because higher loan costs can make it harder for people to buy homes.
Many car and motorcycle companies also lost value.
Most bank shares declined, although HDFC Bank rose on reports about its chief executive succession.
The market reaction showed that companies sensitive to borrowing costs were under pressure.
Markets priced in a greater possibility of a 25-basis-point rate hike in October amid concerns about tighter liquidity and elevated crude prices.
The BSE Realty index declined broadly on fears that higher borrowing costs could weaken property demand.
Prestige Estates fell 4.79%, while Godrej Properties and Oberoi Realty each declined about 4.2%.
Most auto stocks fell, led by Ashok Leyland’s 4% decline; Bajaj Auto and TVS Motor dropped 2-2.5%.
Most BSE Bankex stocks declined, with SBI, ICICI Bank, Axis Bank and IndusInd Bank falling up to 2.25%, while HDFC Bank gained.
- Who
- Indian real-estate, automobile and banking companies, along with investors and analysts at MOFSL.
- What
- Rate-sensitive shares declined as expectations grew for a possible 25-basis-point rate hike in October.
- Where
- Indian stock markets, including the BSE Realty index and BSE Bankex.
- When
- Ahead of the expected October rate decision; the articles do not specify a publication date.
- Why
- Investors feared tighter liquidity, elevated crude prices and higher interest rates could weaken demand and raise borrowing costs.
Key facts
- Expected October move
- A 25-basis-point rate hike became a meaningful possibility.
- MOFSL rate-cycle estimate
- MOFSL forecast 75-100 basis points of cumulative hikes under a sustained oil-shock scenario.
- 10-year yield view
- MOFSL retained a 7.0-7.2% 10-year yield range for the rest of FY27.
- Realty index
- All BSE Realty index stocks declined.
- Largest cited realty fall
- Prestige Estates fell 4.79% to Rs 1,432.95.
- Banking exception
- HDFC Bank rose on reports related to CEO succession.
- Worst cited Bankex performer
- AU Small Finance Bank fell 2.38% to Rs 1,030.70.
Quotes
MOFSL
The brokerage and financial research firm cited in the article
“An October rate hike is now a meaningful possibility, particularly if crude remains elevated.”
businesstoday.in
Sources
Related news
Indian Stocks Slide as Crude Surge Revives Rate Fears
Realty Shares Slide as Bond Yields Raise Rate Concerns
Crude Tops $100 as RBI Rate-Hike Pressure Intensifies
Nifty Extends Losing Streak as Crude and Yields Rise
RBI Minutes Rattle Bonds and Revive Rate-Hike Bets
Why Indian Banking Stocks Are Falling Amid Global Headwinds
Smaller Indian EV Brands Accelerate Growth Amid Two-Wheeler Boom
Rajkumar Hirani Says AI Will Transform the Future of Filmmaking
Ola Electric Delays Three-Wheeler Launch After ₹229 Crore Spend
India’s EV Shift Creates Growth for Wiring and ECU Makers
