Selling in financial, IT stocks take toll on mkts

Mumbai: Benchmark indices Sensex and Nifty snapped their three-day winning run to close down by half a per cent on Friday due to selling in financial and IT shares amid weak global market trends. The 30-share BSE Sensex declined by 316.94 points or 0.52 per cent to settle at 61,002.57 as 22 of its constituents ended in red. During the day, it fell 508.84 points or 0.82 per cent to a low of 60,810.67. The broader NSE Nifty dropped by 91.65 points or 0.51 per cent to end at 17,944.20 with 33 of its stocks closing down. Sensex gained 887 points or 1.5 per cent while Nifty rose by 265 points or 1.7 per cent in three sessions to Thursday.

Ajit Mishra, VP - Technical Research, Religare Broking Ltd, said: “Markets traded under pressure and lost half a per cent, pressurized by weak global cues. After the initial downtick, the Nifty index tried to pare losses but continuous selling in the banking majors combined with a downtick in the IT majors pushed the index lower.”. Among major Sensex losers, Nestle fell the most by 3.12 per cent. IndusInd Bank, Mahindra & Mahindra, State Bank of India, Kotak Mahindra Bank, Tata Consultancy Services, HCL Technologies, Axis Bank, Infosys and Bharti Airtel were among the laggards. Larsen & Toubro, UltraTech Cement, Asian Paints, NTPC and Reliance were among the gainers.

Vinod Nair, Head of Research at Geojit Financial Services, said: “Lack of major triggers in the domestic market is attracting global cues to dictate the market trend. The US market is facing an unfavourable combination of higher-than-expected inflation and a stronger job market. The PPI (Producer Price Index) in the US came in at 6.0 per cent, in contrast to the expectation of 5.4 per cent. This suggests that interest rates have not yet peaked and will remain elevated for a long period.” US markets had their biggest drop in four weeks on Thursday as investors registered disappointment over an inflation reading that came in higher than expected. In the broader market, the BSE midcap gauge fell 0.75 per cent and smallcap gauge dipped 0.24 per cent. Among the sectoral indices, realty declined by 1.86 per cent, telecommunication by 1.30 per cent, bankex (1.23 per cent), teck (1.17 per cent), IT (1.06 per cent) and financial services (0.96 per cent). Energy, industrials, capital goods and oil & gas were the gainers. Adani Enterprises fell by 4.15 per cent after the Supreme Court refused to accept in a sealed cover the Centre's suggestion on a proposed panel of experts for strengthening regulatory measures for stock markets in the wake of the recent Adani Group shares crash triggered by Hindenburg Research's fraud allegations. In Asian markets, Japan, South Korea, Hong Kong and China ended lower. European markets were trading in negative territory.

The US markets had ended sharply lower on Thursday. International oil benchmark Brent crude fell 1.74 per cent to $83.66 per barrel. Foreign Portfolio Investors (FPIs) were net buyers as they bought shares worth Rs 1,570.62 crore on Thursday, according to exchange data.