Metal and realty shares were among the top losers in Wednesday's trading session after the Reserve Bank of India raised the benchmark interest rate by 25 basis points to 5.50 percent, its first increase in nearly four years, and signalled that further hikes could follow.
A higher repo rate raises borrowing costs and can weigh on demand for interest-rate-sensitive sectors such as real estate. For metal companies, higher interest rates can raise financing costs and weigh on economic activity and demand, putting pressure on their shares.
The Nifty Metal index was the top sectoral loser, declining 2.3 percent and snapping its previous two-session rise.
National Aluminium Company Ltd (NALCO) was the top laggard in the Nifty Metal index, falling a little over 4 percent. All constituents of the index traded lower.
Adani Enterprises declined 3 percent, while Hindalco Industries and JSW Steel fell up to 3 percent.