Banks slump; GDP data dashes rate-cut hopes

Reuters Market Eye - The NSE's sub-index of banking stocks falls 2.1 percent, hurt by declines in lenders such as HDFC Bank Ltd as hopes the central bank would cut interest rates next month were dashed after the economy grew in line with forecasts in the March quarter.

HDFC Bank falls 3.2 percent, ICICI Bank Ltd is down 1.1 percent, while State bank of India declines 1.5 percent.

Reserve Bank of India Governor Duvvuri Subbarao's comments on Thursday that retail inflation is still high and that several upside risks to inflation remain are also seen dashing rate cut hopes.

(Reporting by Abhishek Vishnoi)