Banking stocks, led by private banking majors have finally halted the gradual rally in Indian stocks during the week. While overall markets have been trading strong over last few trading session, market experts were waiting for a correction. From the lows seen in March 2020, majority of stocks have recovered smartly and some counters have even touched 52-week highs in the recent weeks. Banking stocks have declined during the afternoon session today, pulling down Indian indices.

BSE Sensex touched intraday low of 37,654 and during the last 30 minutes of trade, markets recovered to 37,890. The decline in banking stocks led to lower valuations for other stocks as well. HDFC Bank, Axis Bank, ICICI Bank were down by nearly 4 percent today. Kotak Mahindra Bank managed to have lower losses compared to other major private sector banks.

The decline in European indices led to massive decline in Indian markets. The macro data from China was another reason for decline in Indian markets and even Asian stocks were trading low. Markets worldwide are in overbought territory and a small correction would be considered healthy by market participants.

Meanwhile, RBI has approved Rs 57,000 crore dividend to Indian government.