A range of domestic and global factors led to nearly 86-point fall in BSE Sensex and restricted the broader Nifty below 8,100 — marking 5th loss on a weekly basis for both benchmark indices in as many as past six weeks.
The volatile week saw the market trading range-bound with investors being cautious about the demonetisation impact and several other key global events that set the tone for the bourses.
Stocks could not sustain the gains augmented by news specific buying in auto, telecom, power and energy counters on sentiments buoyed by strong GDP numbers and core sector growth amid surge in crude oil prices after the decision to lower production at key OPEC meet this week.
The momentum was squeezed by domestic factors including, continued FII outflows, unexpected move by the RBI to hike CRR by 100 per cent on incremental deposits that pressurized banking stocks.
Besides, sharp deceleration in manufacturing PMI, temporary cut in India’s GDP growth forecast by Fitch rating, diminishing auto sales number due to a cash crunch post demonetisation led to a dampened sentiment.
Moreover, participants remained cautious in view of the next week’s RBI’s monetary policy review.
Further, investors caution prevailed ahead of US monthly job report and expectation of rate hike this month, it was further intimidated by concerns of political stability in Euro zone on Italian referendum of constitutional change this Sunday.
During the week, the Sensex lost a modest 85.68 points, or 0.33 per cent, to settle at 26,230.66. It hovered in the range of 26,769.32 and 26,182.93 during the week.
The Nifty 50 index during the week declined 27.50 points, or 0.34 per cent, to close at 8,086.80 after shuttling between 8,250.80 and 8,066.50.
The selling was led by IT, bank, metal, teck, consumer durables, IPOs, oil&gas, PSUs, realty and healthcare.
While buying was witnessed in auto, power, capital goods and FMCG, well supported by secondline shares of midcap and smallcap companies.