NEW DELHI: The Indian equity market snapped its eight-session winning streak on Friday on account of profit-booking at elevated levels and weak global cues. The 30-share index Sensex fell 652 pts to close below the 60,000 level at 59,646 points and the Nifty closed 198 points lower at 17,758.
After a flat start, the benchmark indices plunged sharply in the first half and remained range bound thereafter. In line with the benchmarks, mostly sectoral indices ended lower and had a similar trend on the broader front as well.
Among stocks, IndusInd Bank, Bajaj twins, Tata Steel and State Bank of India witnessed a sharp decline, falling up to 3.82% on Friday. “The decline in the index engulfed the gains of the last three sessions and we may see further profit taking ahead. And, it would be healthy after the recent surge. Moreover, participants should maintain caution and prefer defensive i.e. FMCG, pharma over others until the trend resumes,” said Ajit Mishra, VP - Research, Religare Broking.
Apurva Sheth, Head of Market Perspectives, Samco Securities, said that the Nifty has developed a bearish engulfing candlestick pattern, raising the possibility of a slight decrease due to profit taking. The Nifty’s positional view remains bullish, and traders are encouraged to use the buy-on-dips strategy. On the downside, the 17, 200 zones are now acting as immediate support, added Sheth.
The recent rally of the dollar index and FIIs turning net sellers have surprising bulls. Foreign institutional investors (FIIs), who have been buying aggressively in the Indian stock market since late July, turned net sellers on Thursday as they sold shares worth Rs 1,706 crore, as per NSE data. However, on Friday they turned net buyers and purchased shares worth Rs 1,110 crore.
The rupee, meanwhile, depreciated 20 paise to close at 79.84 (provisional) against the US dollar on Friday as US Federal Reserve hinted at rate hikes in the coming future. The dollar index, which gauges its strength against a basket of six currencies, rose 0.18 per cent to 107.67.