What to Watch. Will RBI surprise with rate-cut largesse?

A 25-basis-point cut announcement by the Reserve Bank of India on Tuesday at its monetary policy review may not surprise marketmen. Already, a mood for a 50-bps rate-cut has set in in the market place. If that happens, shares of not only banks but also the larger market will rejoice. And, if the RBI surprises by announcing a cut in the cash reserve ratio (the amount to be parked with the RBI), then the market will see a sharp rally. Watch the likes of SBI, ICICI Bank, and HDFC Bank, among others.