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The Sensex down over 300 points; Yes Bank, RBL Bank shares plunge over 10%

Indian shares fell sharply today after a two-week rally, dragged down by declines across banking and metals shares. The Sensex was down over 300 points at 38,509 while Nifty was down 0.8% at 11,421. Yes Bank, RBL Bank and Indiabulls Housing Finance led the decline in financials. Earnings announcements for the quarter ended September are scheduled to begin from next week.

Here are 10 updates from stock markets today:

1) Shares in Lakshmi Vilas Bank Ltd fell 4.9% to their lowest since April 2009 on after RBI initiated prompt corrective action on the lender. Under PCA, banks are mandated to cut lending to corporates and focus on reducing concentration of loans to certain sectors.

2) Indiabulls Housing Finance, which had proposed to merge with Lakshmi Vilas Bank, slumped 22%.

3) Shares in private-sector lender Yes Bank fell 11%. The decline comes despite the bank saying that it has received approval from RBI to increase its authorised share capital in order to raise funds.

4) Another private sector lender RBL Bank also plunged 11%, dragging down the Nifty Bank index by over 2%.

5) The Nifty metals index fell nearly 2%. Tata Steel, Vedanta and JSW Steel lost over 2%.

6) Ajit Mishra, vice president of research at Religare Broking, expects markets to consolidate further. “We feel the upcoming RBI monetary policy review meet could trigger the next directional move. Meanwhile, we suggest continuing with stock-specific trading approach and focusing more on the index majors for short term trades,” he said.

7) The RBI is widely expected to cut interest rates when it announces monetary policy on Friday.

8) After remaining net sellers for the past two months, foreign investors infused a net 7,714 crore into the domestic capital markets in September after corporate tax cut by the government.

9) Foreign portfolio investors poured in a net 7,849.89 crore into equities and withdrew a net 135.59 crore from the debt segment between September 3-27, translating into a cumulative net inflow of 7,714.30 crore.

10) Further FPI inflows into India will also be influenced by how the economy performs and how soon corporate earnings recover, say analysts.

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