Bearish global indices, coupled with weak macro-data and disappointing third quarter results, subdued Indian equity markets on Friday with a barometer index closing 318 points in the red.According to market observers, slide in the Asian and European markets combined with a further fall in global crude oil prices led to sharp downward correction.In addition, disappointing quarterly results and rupee plunging to a new 28 month-low dragged the markets' south.Friday's sell-off was broad-based, as mid-cap and small-cap stocks bore the maximum brunt.Initially, both the bellwether indices opened on a firm note, following higher closing of the US markets on Thursday and value buying at lower levels. However, both indices soon ceded their initial gains due to bearish Asian markets -- as a Chinese bellwether touched a new low, followed by lack of fresh triggers.Investors were also caution over Q3 results -- after an FMCG (fast moving consumer goods) major reported weaker-than-expected earnings.
Besides, the bellwether index receded after Thursday's macro-economic data showed an acceleration in inflation trends.The rising wholesale price index (WPI), coupled with a higher annual retail inflation, have diminished hopes of a rate cut by the country's apex bank. Moreover, long-liquidation positions, sliding European markets and upcoming US macro-data dented sentiments.The barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) closed lower by 318 points or 1.28 percent.Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) plunged during the day's trade. It was down by 99 points or 1.31 percent at 7,437.80 points. The Nifty closed below the 7,500-mark for the first time since 2014. The S&P BSE Sensex, which opened at 24,881.76 points, closed at 24,455.04 points -- down 317.93 points or 1.28 percent from the previous day's close at 24,772.97 points.The Sensex touched a high of 24,912.64 points and a low of 24,421.53 points during the intra-day trade.The S&P BSE market breadth favoured the bears -- as more than five shares declined for every share which advanced. There were 2,315 declines and only 380 advances."Bearish Asian markets, disappointing macro-data and caution over the upcoming Q3 results depressed investors. The general weakness continued with lack of fresh triggers. markets moved in a tight range," Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.
Vaibhav Agarwal, vice president and research head at Angel Broking, elaborated that that market breadth remained weak, as BSE mid-cap (-2.68 percent) and small-cap (-3.13 percent) indices corrected sharply."We expect markets to react to key results in the coming week," Agarwal noted."Investors will also watch out for US industrial production and inflation data expected later today for further cues on the US economy."Sector-wise, shares of banking, capital goods, automobile, consumer durables and metal came under selling pressure.The S&P BSE banking index plunged by 482.57 points, capital goods index receded by 359.86 points, automobile index declined by 308.55 points, consumer durables index slumped by 222.51 points and metal index edged-lower by 180.80 points.
On the other hand, slight buying was observed in information technology (IT) and energy stocks.The S&P BSE IT index rose by 7.45 points and energy index inched-up by 2.78 points.The foreign institutional investors (FIIs) were net sellers during the day's trade, while domestic institutional investors (DIIs) were net buyers.According to data with stock exchanges, FIIs divested Rs.1,123.79 crore, while DIIs bought stocks worth Rs.688.84 crore.Besides equities, the rupee got battered in the day's trade. It touched a new 28-month low. It ended weaker by 30 paise at 67.60 to a US dollar from its previous close of 67.30 to a greenback. "The rupee's fall can be attributed on the pressure that was exerted on all the emerging markets' (EMs) currencies, due to collapse in commodity prices and risk of further yuan devaluation," Anindya Banerjee, associate vice president for currency derivatives with Kotak Securities, told IANS.
Major Sensex gainers during Friday's trade were Reliance Industries, up 1.13 percent at Rs.1,073.15; Infosys, up 1.02 percent at Rs.1,140.20; DrReddy's Lab, up 0.74 percent at Rs.2,936.70 and Maruti Suzuki, up 0.56 percent at Rs.4,273.30.Major Sensex losers during day's trade were Gail, down 6.01 percent at Rs.336.15; State Bank of India (SBI), down 5.64 percent at Rs.184.75; BHEL, down 5.08 percent at Rs.136.50; NTPC, down 4.58 percent at Rs.136.60; and ICICI Bank, down 4.57 percent at Rs.224.55.