Market review: Why BSE Sensex and Nifty are under stress after RBI policy announcement

Following the announcement of the credit policy by RBI, Nifty50 fell below the 11900-mark while the BSE Sensex also dropped several points. The stock market was not enthused with the RBI's announcements as it appeared that the central bank is not aggressive in solving liquidity crisis, problems of banks and NBFCs. Markets are, hence, facing heavy stress after the credit policy announcement.

The RBI today went for a hat-trick of rate cut, lowering its key lending rate for commercial banks by 25 basis points (bps) to 5.75 per cent. This is the third reduction in repo rate in 2019. In April, RBI had lowered its key lending rate by 25 bps to 6 per cent. Before that, in February, the MPC had voted to lower the repo rate by 25 bps to 6.25 per cent.