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Banking shares fell across the board as the Reserve Bank of India (RBI) sounded hawkish, raising worries on further monetary easing.
IndusInd Bank and Canara Bank were the worst hit with both the stocks falling more than 2 per cent each.
Other banking stocks that declined were Yes Bank, State Bank of India, Punjab National Bank, Bank of India and Axis Bank.
The RBI may not cut interest rates through the entire year which left analysts worried that banking stocks may see further downslide, especially since most of the banks are grappling with non performing assets, especially the PSBs.
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