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Snapping two days of gains, the benchmark BSE Sensex declined 0.38 per cent, or 86.37 points, to end at 22,628.96, while the 50-share Nifty ended 20 points or 0.3 per cent lower at 6,776.3. Both the indices, however, marked their third straight week of gains. The Sensex and Nifty had hit all-time highs on Thursday. Weak global markets weighed on Indian stocks.
Most Asian and European markets traded lower due to a sharp sell-off in technology and biotechnology stocks in the US. The MSCI Emerging Markets Index fell 0.9 per cent while the Stoxx Europe 600 Index traded more than a per cent lower.
Brokers said investors turned cautious ahead of next week’s data sets. Consumer inflation data will be announced on Tuesday. Quarterly earnings of IT major Infosys are also due the same day.
“It’s going to be a crucial session on Tuesday as participants would be seen reacting to IIP numbers and the Infosys result on opening. And, that would set the tone for the rest of the day. Considering the situation in hand, it’s advisable to keep a cautious approach and avoid over-leveraging,” said Jayant Manglik, president, retail distribution, Religare Securities.
Among sectoral indices, auto, banking and oil and gas fell the most, while IT stocks saw a rebound. Tata Motors, Reliance Industries and State Bank of India were among the major losers among index stocks.
Foreign institutional investors (FIIs), who have driven Indian stocks higher this year, sold equities for the first time in almost a month. According to provisional data, FIIs net sold shares worth Rs 360 crore on Friday. Overseas investors have pumped in over $4.5 billion into Indian stocks so far in 2014.
Indian markets have rallied more than 25 per cent since August last year on hopes of a stable government after the elections. Although, the Street is divided over whether these gains have been excessive, some believe that the market could go up further if the National Democratic Alliance (NDA) gets a clear majority.
“In India, every dip is taken as an opportunity to buy as the consensus moves towards a majority BJP-led government at the Centre. The heavy poll turnout seen in the first few phases of the election has added fuel to that expectation. If there is a clear majority to the NDA, there is a strong possibility that the markets will continue to move higher,”said Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services.
