The primary factor for Friday's fall cited by dealers was a technical correction, following a sharp rise in most of the stock in the last four weeks. In addition, the profit warning by software giant Microsoft last night also led technology stocks to be in the grip of bears on the last day of settlement on the Bombay Stock Exchange (BSE). Media stocks on BSE also led the fall.

"This fall is a technical correction and is good for the overall health of the market. After a rise over the last couple of weeks, some profit-taking was bound to come," Mr Arun Kejriwal of Nikko Stock Broking said.

The market opened weak in the morning and dipped further in the later part of the day. The BSE Sensex opened at 4241.46 points and touched a low of 4130.6 before closing at 4137.6, a fall of 133.29 points. At National Stock Exchange (NSE), S&P CNX Nifty was down by 36.75 points to close the day at 1,312.6 points.

Among the major losers of the day were Himachal Futuristic, down by 14.3 per cent to close at Rs 1,322.8. Another active counter Global Telesystems was also locked in the lower circuit as it fell by 10.8 per cent to end the day at Rs 1028. Market sources said that a leading FII was believed to be a major seller in these counters. A negative research report on Himachal Futuristic by one of the leading FIIs led to panic selling in this counter.

Among the index stocks, Zee Telefilms was locked in the lower circuit and closed below the Rs 300-mark at Rs 295.5 (down 9.9 per cent). Other index counters in the loser list include Satyam Computers (down 7 pr cent), ICICI (5.5 per cent) and Infosys Technologies (4.9 per cent).

But the ITC counter remained in the positive territory and closed 1.4 per cent higher at Rs 923.1. Other gainers of the day were Knoll Pharma up 10.19 per cent at Rs 390.3 and Tata Power closed up 5.87 per cent at Rs 95.80.