The country?s bourses took a beating on Friday, losing over one-and-a-half percentage points in line with global indices which fell over worries that Europe?s debt-cutting measures will harm global growth. However, benchmark indices ended the week in the black, gaining over a percentage point.
?Investors probably wanted to wait and watch how the situation in the Euro zone region stabilises over the weekend. The euro was also under pressure. Besides, local results, especially State Bank of India?s, were not very encouraging,? said Vaibhav Sanghavi, director, Ambit Capital. On Friday, the euro fell below $1.25 as of 10.02 am in London for the first time since March 2009.
The BSE Sensex slid 271.27 points, or 1.57%, to close at 16,994.60 while the NSE Nifty was down 85.40 points, or 1.65%, at 5093.5. For the week, the Sensex rose 1.34% while the Nifty was up 1.5%. According to BSE?s provisional estimates, FIIs were net sellers to the tune of Rs 381 crore, while domestic institutional investors bought shares worth Rs 164 crore. From Monday to Thursday, FIIs bought shares worth Rs 765 crore, according to Sebi data.
The market remained volatile during the week gone owing to global factors. ?This will persist for some more time. A lot depends on how the trillion dollar package for Europe is implemented and if the austerity measures for the affected countries are accepted by their citizens,? said Sanghavi.
Stocks fell around the world on Friday on concern that Europe?s debt crisis will limit growth and earnings of corporates. The Stoxx Europe 600 Index slumped 1.8% at 10:36 a.m. in London and the MSCI Asia Pacific Index fell 1.1%. Deutsche Bank AG CEO Josef Ackermann said Greece may not be able to repay its debt in full and former Federal Reserve Chairman Paul Volcker said he?s concerned the euro area may break up.
Most of the key benchmark equity indices in Asia Pacific declined. The Nikkei 225 and Hang Seng lost more than a percentage point, dipping 1.49% and 1.36%. The Kospi and Jakarta Composite bucked the trend, gaining 0.06% and 0.38%, respectively.
Back home, 26 of the 30 Sensex components declined. The broader market breadth was weak with 2,019 declines compared with 844 advances. Realty and Metal indices declined the most at 2.49% and 3.48%, respectively. ?We expect metal prices to fall going forward. The incremental demand from the US and Europe has slackened and China is tightening its monetary policy,? said Sanghavi.
The NSE cash turnover on Friday was at Rs 13,071 crore, while the six monthly daily average is Rs 14,304 crore. Turnover in derivatives was Rs 99,457 crore and the daily average for the past six months is Rs 78,958 crore.