Rate-sensitive stocks trade lower on Urjit Patel's resignation; HDFC Bank, Oberoi Realty fall 2-3%

Interest rate-sensitive stocks are trading in the red with Nifty Bank, Nifty Auto and Nifty Realty down up to 1 percent each after the sudden announcement of resignation of Reserve Bank of India Governor Urjit Patel.

Bank Nifty was down over 1 percent with losses from HDFC Bank and ICICI Bank which shed 2 percent each while IndusInd Bank and Kotak Mahindra Bank were the other top losers. Axis Bank and IDFC Bank also traded lower.

The auto index was trading lower by half a percent dragged by Hero MotoCorp and Maruti Suzuki, which shed 1 percent each, followed by Bharat Forge, Motherson Sumi Systems, Tata Motors and TVS Motor Company.

Nifty was Realty dragged by Oberoi Realty down over 3 percent followed by Godrej Properties, Phoenix Mills, Sobha, Sunteck Realty and Indiabulls Real Estate.

According to a report by BofAML, RBI Governor's resignation adds to uncertainties for the equity market and near-term reactions may lead to outflow, higher bond yields and weaker rupee adding that it could hurt interest rate-sensitive stocks. Banks could come under pressure in the near term.

Sudarshan Sukhani of s2analytics.com has a buy on Hero MotoCorp with stop loss at Rs 3,000 and target of Rs 3,080.