Mumbai: The benchmark index fell 1.6 percent on Friday to post its biggest fall since May 16 as b lue chips such as Reliance Industries w e re hit by rising worries about India’s slowing economy at a time of worsening global risk aversion.
Sensex at closing
The falls on Friday tracked weaker global shares after surveys showed Chinese factory output barely growing and powerful European manufacturing countries falling deeper into malaise. The data came ahead of the key US jobs figures later on Friday.
Traders expect more volatility in June, with key events scheduled, such as inflation data and a key Reserve Bank of India meeting on 18 June that some analysts say could deliver an interest rate cut.
Globally, Spanish banking woes and new Greek elections will be among the factors that could keep risk assets under pressure, analysts said.
Foreign investors have sold a net Rs 183 crore ($32.59 million) as of Thursday this week, a ccording to provisional exchange data.
“It’s very hard to see a recovery in markets in the near term as problems in Europe are exacerbating. A favorable verdict in Greece elections may change the sentiments though.” Paras Adenwala, managing director, Capital Portfolio Advisors
The main 30-share BSE index fell 1.56% to close at 16,965 points on Friday, falling by the exact same percentage amount for the week, and marking its fifth weekly fall in six.
The broader 50-share NSE index declined 1.68% to 4,841.60 points.
“Trend would remain down. There might be a spurt on rate cuts,” Adenwala said, adding that fear is offsetting stock valuations that are becoming quite attractive.
The BSE index fell for a third consecutive session on Friday, still reeling after the country on Thursday posted 5.3% growth in the January-March quarter, its weakest growth in nine years.
Indian markets fell on Friday. Mint’s Lisa Pallavi Barbora talks the day’s biggest gainers led by the Oil companies and those who didn’t fare so well
Blue chips, especially in the manufacturing sector, were especially badly hit, with Larsen & Toubro ending down 3.2%, bringing its fall to 4.5% in two sessions.
Reliance Industries shares lost 2.88%.
Indian software services exporters shares fell as the $100 billion domestic industry draws the majority of its revenues from the U.S and Europe.
Infosys shares lost 1.65%, while Tata Consulting Services fell 1.7%.
Meanwhile, auto makers fell after posting lacklustre sales in May, as an excise tax hike and rising fuel prices hit demand.
Maruti Suzuki shares fell 2.3% after India’s biggest car maker said passenger car sales fell 5.9% from a year earlier.
Tata Motors shares fell 3.6%. India’s third-biggest car maker has had a tough week, falling 15.8% over the past three sessions after posting disappointing quarterly operating performance on Tuesday.
However, gas utility Indraprastha Gas Ltd surged 31.5% on TV reports that a New Delhi court had reversed a regulator’s order asking IGL to tariffs in India’s capital.
The company confirmed the ruling in an exchange statement after the markets’ close.
The reported ruling sent other gas stocks higher, with Gail ending up 1.62%.
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Graphic by Sandeep Bhatnagar/Mint