The Sensex closed down 0.46 per cent on Friday, reversing early gains, after data showed the country’s industrial output in December slowed sharply and Morgan Stanley cut its allocation for emerging market stocks.
Industrial output grew just 1.8 per cent in December, its slowest in two months, as sluggish global growth, tight monetary policy from the central bank and government policy paralysis stifles economic growth.
Shares in car makers, construction companies and banks all fell, as the less-than-forecast figure confirmed fears of slowing economic growth.
Foreign funds have invested more than $3.6 billion in local equities so far this year, data from the Securities and Exchange Board of India showed. In 2011, they were net sellers of about $500 million.
The main 30-share BSE index fell 82.06 points to end at 17,748.69, with 22 of its components losing value. The benchmark index was up 0.3 per cent before the industrial output data was released.
The 50-share NSE index ended 0.57 per cent lower at 5,381.60 points. In the broader market, gainers led losers by a ratio of about 4:3 on a larger than average volume of almost 1 billion shares.
Tata Steel, the world’s no 7 producer, was the benchmark index’s best performer on Friday, as investors reversed early falls on news that the company expected rising domestic sales in the coming financial year.
