BSE Sensex down 1 percent; financial firms extend losses

Reuters Market Eye - The BSE Sensex falls over 1 percent after the RBI's measures to curb the rupee's slide are seen hurting growth, tightening liquidity and lowering the likelihood of rate cuts in the medium term, dealers say.

The BSE index <.BSESN> is down 1.02 percent and the NSE <.NSEI> is down 1.32 percent, heading towards snapping their 3-day gaining streak.

Shares in India's financial firms fall. IDFC Ltd slumps 7.3 percent, while Housing Development Finance Corp Ltd is down 3.6 percent.

Lenders that are dependent on short-term wholesale funding like Yes Bank Ltd will be most impacted by the central bank's measures to curb liquidity, analysts say.

 

Yes Bank slumps 9.6 percent while IndusInd Bank Ltd sinks 8.5 percent.

Among banks, ICICI Bank Ltd falls 5.4 percent while HDFC Bank Ltd is down 2.1 percent a day ahead of its earnings results for June-quarter.

(Reporting by Abhishek Vishnoi)