Market flogs self on macro economic worries, Nifty down 56 pts

Mumbai, Jan 25 (PTI) The bourses punished self followingRBI''s indication of worsening macro economic scenario and itssubsequent hike in key interest rates as the benchmark S&P CNXNifty closed below the psychological 5,700 level on theNational Stock Exchange (NSE) here today.

In its clear message to act tough to contain theinflation the Central Bank in its third quarter review hikedthe repo and reverse repo rate by 0.25 basis points each.

The 50-share index swung wildly between 5,801.55 and5,680.65 before concluding at 5,687.40, down 55.85 points or0.97 per cent over its previous close.

The session, which commenced on positive undertones,initially reacted actively on RBI''s rate hike measures takingthe key index to the day''s highest point. Subsequently itbecame highly volatile after Central banks grim GDP forecastand rising inflation following which the market went intoheavy selling in banking counters along with index heavyweights.

"Being the last trading session before the derivativescontract expiry for the January series could also be one ofthe reason for the extreme volatility in today''s trade,"traders said.

"The situation is not at all rosy, with the risinginterest rate scenario the market is likely to under-performin coming days," they opined.

Hindunilever, ICICI Bank, HDFC Bank, Dr Reddy''s, M&M,SAIL, Suzlon, Sun Pharma, Axis Bank and Kotak Bank were thetop losers from the Nifty.

Total turnover in the cash segment rose to Rs 13,064.45crore from Rs 11,548 crore yesterday. A total of 5,488.17 lakhshares changed hands in 55,53,841 trades.