Market sentiment sours as Urjit exits

The RBI Governor Urjit Patel tended his resignation on Monday ahead of the crucial board meeting scheduled for Friday, December 14. Also, the state election results will bring more volatility to the Indian equity markets.

Despite being appointed by the BJP government, Patel has opted to step down after facing immense pressure from the government on several issues including tweaking of PCA norms, transfer of RBI reserves to the government and providing NBFCs with the lender of last resort (LOLR) facilities.

Patel tenure as the RBI chief is marred with the monumental decisions demonetisation, the unravelling of PNB scam and the collapse of IL&FS. However, by quitting office he clearly indicated his disagreement with the government's intent to weakening the institution of RBI.

With this, the BJP government has seen three major exits of high-ranking economists including former RBI Governor Raghuram Rajan and former Chief Economic Advisor, Arvind Subramanian.

Reacting to this development alongwith the state election results trickling in, the BSE Sensex was at 34,514.23, down by 445.49 or 1.27 per cent in pre-opening session on Monday. Of the total 404 number of companies traded, 74 advanced 311 declined, while 19 remained unchanged. 

Meanwhile, the Nifty50 was quoting 10,356.85, down by 131.60 or 1.25 per cent and Bank Nifty was at 25,602.25, down by 500.40 or 1.92 per cent.