Markets reacted negatively to inflation data that came in higher then expected at 7.55%. Analysts now marketmen believe that the RBI would not cut rates aggressively when it meets for its monetary policy review meeting on June 18, 2012.
Weak openings in European markets also affected sentiments negatively. The German DAX, the French CAC and the European FTSE all trading lower. Banking stocks were battered badly with State Bank of India, ICICI Bank and Punjab National Bank losing heavy ground.
Infrastructure major Larsen and Toubro also lost ground today, as analysts believe that a sharp drop in interest rates was unlikely affecting an infrastructure player like Larsen and Toubro.
Among the shares that gained in trade today were IT major Infosys, ACC, Cipla and BPCL. Markets are now expected to be volatile ahead of the RBI meet on Monday and also due to the elections in Greece which are slated for Sunday.