Rate-sensitive stocks in demand after RBI move

MUMBAI: Rate sensitive sectors were the frontrunners in Monday's rally after a surprise weekend rate cut by the Reserve Bank of India, thus easing a growing cash squeeze, spurring hopes of a resultant cut in banks' lending and deposit rates during the coming weeks.

Allahabad Bank, Bank of India, HDFC Bank were among other banking stocks up 5-16 percent after RBI's move. ICICI Bank, India's second-largest lender, rose nearly 10 per cent to Rs 439.1, UCO Bank rose 15 per cent to Rs 31.65, while state-run State Bank of India gained 7.5 per cent to Rs 1,193.

Real estate stocks also gained momentum on hopes that cut in home loan rates would revive demand. Real estate companies are currently facing a severe liquidity crunch, given high interest rates and lack of availability of funds.

Industry leader DLF gained 9.46 per cent to Rs 240.95, Peninsula Land climbed 15.95 per cent to Rs 23.65, Parsvnath Developers climbed 8.5 per cent to Rs 44 and Unitech rose 5.1 per cent.