Weak global cues, along with profit booking and caution ahead of the Goods and Services Tax (GST) implementation subdued the Indian equity markets during the week ended Friday.
However, hopes of an interest rate cut aided the key indices to pare some of their losses.
On Friday, the 30-scrip Sensitive Index (Sensex) of the BSE closed at 31,138.21 points -- up 81.81 points or 0.26 per cent from its previous week's close.
Conversely, the NSE Nifty inched lower by 13.1 points or 0.13 per cent to close the week's trade at 9,574.95 points.
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Broader markets like the BSE mid and small cap witnessed correction due to recent run-up and declined by 1.5 per cent and 1.8 per cent respectively.
"Markets drifted lower this week as investors preferred to take profits on
Friday ahead of the long weekend," Deepak Jasani, Head - Retail research, HDFC Securities, told IANS.
"It was the second consecutive week of losses for the Nifty. The Nifty ended with W-o-W losses of 0.14 per cent. Market breadth was negative in all the five trading sessions of the week."
According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, investors' sentiments remained subdued after Finance Minister Arun Jaitley indicated that the economy will have to face short-term challenges in implementing the biggest tax reforms (GST) since Independence.
The single tax regime on the supply of goods and services is proposed to be rolled out on July 1.
Besides GST roll-out, the downturn in the global markets also led the key indices to end on a flat note.
"Markets were jittery as monsoon showers in central India were delayed which is expected to disrupt the sowing. Global markets were hit by a decline in crude oil prices due to a supply glut," Vinod Nair, Head of Research, Geojit Financial Services, told IANS.
"Emerging Markets are gasping to the risk of faster than anticipated hike in US rate in the future which is expected to impact the liquidity."
Outflows of foreign funds further subdued investors' sentiments said Vijay Singhania, Founder-Director, Trade Smart Online.
"Trading activities remained dull last week on back of... outflow of foreign funds and heavy selling metal and oil and gas stocks subdued investors' sentiments," Singhania said.
Figures from the National Securities Depository revealed that foreign portfolio investors (FPIs) divested Rs 1,053.12 crore, or $163.86 million in the equities segment, during June 19-23.
"FIIs were net sellers adding fear to the stability of the INR," Nair added.
During the week, the Indian rupee weakened by 10 paise to 64.53 as against the US dollar from it's last week's close at 64.43 to a greenback .
In addition, sentiments on the stock markets were tormented by crude oil's tumbling price.
"Crude oil prices hit ten-month lows this week, pushing crude oil well into bear market territory," Singhania said.
"Hopes of the OPEC deal balancing the market are fading fast. The plunging price took a breather later during the week, but hovered at the lowest levels since the third quarter of 2016."
(Rohit Vaid can be contacted at rohit.v@ians.in)
--IANS
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