Nifty, Sensex open lower led by 10% dip in Kotak Mahindra Bank shares on RBI action

Stock market news: Benchmark indexes opened lower on Thursday as financials weighed heavily, primarily due to Kotak Mahindra Bank's significant decline after the Reserve Bank of India's recent actions.

The NSE Nifty 50 commenced the day down 0.38 per cent at 22,316.90, while the S&P BSE Sensex dropped equivalently by 0.38 per cent to 73,572.34 as of 9:15 am.

High-weighted financial services took a hit, with a loss of 0.71 per cent, while private banks shed 0.89 per cent in early trading.

Private lender Kotak Mahindra Bank suffered a notable 9.65 per cent decline at the market open, emerging as the top Nifty 50 loser. This slump followed the Reserve Bank of India's announcement barring the bank from accepting new customers through its online and mobile banking channels, a decision that took effect post-market hours on Wednesday.

The spotlight remains firmly on Kotak Mahindra Bank as investors gauge the ramifications of this regulatory action on the bank's operations and future prospects.

In addition to Kotak Mahindra Bank, the market's attention is also drawn towards key earnings reports. Hindustan Unilever reported a 6 per cent decline in profit, missing estimates, while IT company LTI Mindtree posted a smaller-than-expected revenue for the March quarter, attributed to weakness in its banking vertical and client spending. On a positive note, Axis Bank's fourth-quarter profit surpassed estimates.

Elsewhere, Asian markets opened lower, and US equities closed marginally higher in the previous session. Investors are eagerly awaiting first-quarter US gross domestic product (GDP) data to assess the future rate trajectory of the US Federal Reserve.

Stocks to watch

• Tata Consultancy Services: The company signed a strategic agreement with Amazon Web Services to accelerate cloud transformation and offer artificial intelligence solutions to customers.
• AU Small Finance Bank: The bank reported a fall in March-quarter net profit.
• Macrotech Developers: The company posted a decline in consolidated net profit in the fourth quarter.

Key earnings in focus: Bajaj Finance, IndusInd Bank, Nestle India, Tech Mahindra.

(With Reuters inputs.)