Equity benchmark indices fell by 1 per cent during the afternoon on Friday as the Reserve Bank of India forecast contraction in H1 FY21 GDP growth, cut repo rate by 40 basis points and extended the loan repayment moratorium for another three months up to August 31.
The central bank also increased the group exposure limit of banks from 25 to 30 per cent of eligible capital base for enabling corporates to meet their funding requirements from banks. The increased limit will be applicable up to June 30 next year.
At 12:30 pm, the BSE S&P Sensex was down by 308 points or 1 per cent at 30,625 while the Nifty 50 edged lower by 86 points or 0.95 per cent at 9,020.
All sectoral indices at the National Stock Exchange were in the red, except for Nifty IT, with Nifty private bank down by 2.98 per cent, financial service by 2.91 per cent, metal by 2.05 per cent and auto by 1.17 per cent.
As investors worried over the possible loan repayment defaults, Axis Bank plunged by 4.6 per cent to Rs 340.50 per share.
ICICI Bank dipped by 4.4 per cent and IndusInd Bank slipped by 2.6 per cent while Bajaj Finance and Bajaj Finserv lost by 4.8 and 4.6 per cent respectively.
Home loan lender HDFC too dropped by 4.3 per cent to Rs 1,527.95 per share.
Metal majors Hindalco, JSW Steel and Tata Steel cracked by 4 per cent, 2.7 per cent and 2.6 per cent respectively while Bajaj Auto skidded by 2.5 per cent.
However, those which gained were Infosys which moved up by 2.5 per cent to Rs 689 per share, Asian Paints, Bharti Infratel and Bharat Petroleum Corporation.
( With inputs from ANI )