The Bombay Stock Exchange Sensex recovered marginally after opening at 26472.51, 153.4 points lower on Monday, reported ANI. The National Stock Exchange Nifty opened at 8111.1, a day after Reserve Bank of India Governor Raghuram Rajan announced that he is not going to take up a second term after his tenure ends in September.

The rupee, at 67.65 per dollar, fell by around 1%, but it gained around 20 paise later. Market experts believed that Rajan's announcement played a big role in the trend the currency showed on Monday. "The most notable aspect of his tenure was stemming the decline in the rupee, which has been one of the most stable emerging market currencies," Global brokerage Macquarie had told NDTV.

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"This is a negative surprise as markets were expecting him to continue... Although the news is negative in the near term, we do not expect a lasting medium-term impact," said global financial major Nomura said on Sunday, according to The Hindu.

On Saturday, Rajan announced wrote an email message to his colleagues expressing his decision to return to academia after his term at the central bank ends on September 4. "I will, of course, always be available to serve my country when needed," he said.

Rajan was criticised by Bharatiya Janata Party leader Subramanian Swamy, who wrote to the Centre and claimed Rajan kept interest rates high on purpose, while accusing him of leaking "sensitive financial information". He also alleged that the earlier Congress-led government had appointed the apex bank's governor, and claimed Rajan was "not fully Indian".

After announcing the monetary policy on June 7, Rajan had stayed silent on whether he would return for a second term as RBI Governor. He said, "It would be cruel of me to spoil the fun the press is having," and said he was "intrigued" by the letters that had been sent to the Centre regarding his tenure.