Bank stocks tank up to 7% after RBI's hawkish tone

Bank stocks reeled under selling pressure today, falling up to 7 per cent in-tandem with a sluggish broader market after minutes of the RBI's last policy meeting indicated a shift towards a hawkish stance from June.

Shares of Canara Bank dived 7.08 per cent, Bank of India 6.19 per cent, Andhra Bank 5.54 per cent, and Allahabad Bank 3.57 per cent on BSE.

Among others, YES Bank fell by 3 per cent, PNB 2.60 per cent, ICICI Bank 2.49 per cent, SBI 1.97 per cent, AXIS Bank 1.49 per cent, Federal Bank 1.43 per cent, Bank of Baroda 1.14 per cent and Indusind Bank 1.10 per cent on BSE.

The BSE bank index fell by 1.04 per cent to end at 27,855.37.

Release of the minutes of the Monetary Policy Committee (MPC) meeting after market hours yesterday indicated that the Reserve Bank may shift to a hawkish monetary stance in June, which dented investor sentiment.

"Market traded range-bound due to weak global cues and surge in oil price and yield while banks under-performed after RBI's hawkish view in their minutes," said Vinod Nair, Head of Research, Geojit Financial Services.

The BSE 30-share key index ended marginally down by 11.71 points at 34,415.58.