The Sensex lost 1,060.64 points after a sharp fall in equity markets in the afternoon trade of May 4. Reserve Bank of India (RBI) raised the benchmark lending rate to 4.40 percent To check inflation.
The 30-share BSE benchmark ended 1,060.64 points or 1.86 per cent lower at 55,915.35 in afternoon trade. The NSE Nifty also closed at 16,751.35, down 317.75 points or 1.86 per cent.
On Wednesday, the RBI raised the benchmark lending rate by 40 basis points to 4.40 per cent to control inflation, which has remained above the target zone of 6 per cent for the past three months.
The decision follows an unscheduled meeting of the Monetary Policy Committee (MPC), in which all six members unanimously voted to raise rates while maintaining a lenient stance.
From the Sensex pack, Bajaj Finserv, Bajaj Finance, Titan, HUL, RIL, Asian Paints and HDFC Bank were the major losers. Conversely, PowerGrid, Kotak Mahindra Bank, NTPC, Infosys and Wipro were among the gainers.
On May 2, the BSE benchmark ended 84.88 points or 0.15 per cent lower at 56,975.99 and the Nifty was down 33.45 points or 0.20 per cent at 17,069.10.
Stock markets remained closed on Tuesday on the occasion of Eid-ul-Fitr.
On Wednesday, the markets of Seoul and Hong Kong remained in the red mark. There was a jump in trading on the US stock exchanges on Tuesday.
Meanwhile, international oil benchmark Brent crude jumped 3.63 per cent to $108.8 per barrel.
Foreign institutional investors offloaded shares worth Rs 1,853.46 crore on Monday, according to stock exchange data.