Banking stocks rallied sharply in trade as consumer price inflation for the month of April fell sharply. There were expectations that the Reserve Bank of India (RBI) may cut interest rates even ahead of its policy meet in June.

Shares in Axis Bank rallied a huge 3 per cent, Canara Bank was up 3 per cent and Bank of India was up 2 per cent.

But, the star in trade was Union Bank of India which jumped a huge 7 per cent, following a superb set of quarterly results for the quarter ending March 31, 2015.

It looks almost certain that the Reserve Bank of India would cut interest rates either on its policy meet in June 2, 2015 or ahead of the same.

Market may await for WPI Inflation data that is due later on Thursday.

GoodReturns.in