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China set to impose new HK security law

Credit: SBS- Published on May 21, 2020
The US has warned China it will react strongly if Beijing imposes new national security legislation on Hong Kong that imposes more control over the city.
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Video credit: ANI
Published on May 22, 2020 -  01:14
Equity indices in red after RBI rate cut, banking stocks down as loan moratorium extended
Equity benchmark indices closed lower on Friday due to underperformance by banking and financial stocks as the Reserve Bank of India forecast contraction in H1 FY21 GDP growth, cut repo rate by 40 basis points to inject liquidity and extended the loan repayment moratorium by 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. The measures did not cheer investors who believed the extension of moratorium is good for the economy but in substance will negatively impact banks and non-banking finance companies. At the closing bell, the BSE S and P Sensex was down by 260 points or 0.84 per cent at 30,673 while the Nifty 50 edged lower by 67 points or 0.74 per cent at 9,039. Except for Nifty pharma, IT and auto, all sectoral indices at the National Stock Exchange were in the red with Nifty financial service down by 3 per cent, private bank by 2.8 per cent, metal by 1.8 per cent and realty by 1.1 per cent. As investors worried over the possible loan repayment delays and defaults, Axis Bank plunged by 5.2 per cent to Rs 338.60 per share. ICICI Bank dipped by 3.9 per cent and HDFC Bank slipped by 1.9 per cent while Bajaj Finance and Bajaj Finserv lost by 4.5 and 4.6 per cent respectively. Home loan lender HDFC too dropped by 5.1 per cent to Rs 1,515.85 per share. Metal majors Hindalco, Tata Steel and JSW Steel cracked by 3.9 per cent, 3 per cent and 2.3 per cent respectively while Bajaj Auto skidded by 3 per cent. However, those which gained were Mahindra and Mahindra, Cipla, Infosys, Asian Paints, Britannia and Tech Mahindra. Meanwhile, Hong Kong shares tumbled after China moved to impose a new security law on the city after last year's pro-democracy unrest. That raised the prospect of further straining US-China ties. Hong Kong's Hang Seng index fell by 5.56 per cent to a seven-week low.

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