In volatile trade, the benchmark equity indices Sensex and Nifty edged lower on Friday, dragged down by heavy selling pressure in banking, financial and energy stocks amid mixed cues from global markets. However, lower global crude prices and fresh foreign capital inflows helped the indices curb losses, according to traders.
Shares of banks and NBFC firms fell sharply after the Reserve Bank tightened consumer credit norms asking them to assign a higher risk weight for unsecured personal loans, a move aimed at lenders be more cautious about such advances. After two sessions of gains, the 30-share BSE Sensex shed 187.75 points or 0.28 percent to settle at 65,794.73. During the day, it fell 342.74 points or 0.51 percent to 65,639.74. The Nifty slipped 33.40 points or 0.17 percent to 19,731.80.
“The RBI’s move to raise risk weights for unsecured loans has weighed on banking stocks and caused a temporary disruption to the revival of the broader indices. Despite this, a positive undercurrent prevails, prompting an end to a strong earnings season . “Investors are waiting for inflation in the eurozone. details later today. A sharp fall in oil prices and moderation in US yields will help the market remain buoyant in the short term,” said Vinod Nair, Head of Research at Geojit Financial Services.
Among the Sensex firms, State Bank of India fell 3.64 percent, followed by Axis Bank (3.03 percent). Other laggards included Bajaj Finance, ICICI Bank, Bajaj Finserv, IndusInd Bank, Infosys, Kotak Mahindra Bank, Wipro, and Reliance Industries. On the other hand, Larsen & Toubro, Hindustan Unilever, Power Grid, Asian Paints, Nestle and Mahindra & Mahindra were the top gainers.
In the broader market, the small-cap gauge BSE rose 0.36 percent, while mid-caps gained 0.27 percent. Among the indices, bankex fell 1.48 percent, oil & gas fell 1.35 percent, financial services fell 0.83 percent, and IT fell 0.10 percent. Consumer discretionary, FMCG, healthcare, industrials, capital goods and realty were among the gains.
For the week, the benchmark BSE jumped 890.05 points or 1.37 percent, while the Nifty climbed 306.45 points or 1.57 percent. “The fall in key benchmark indices came on the back of a sell-off in banking and oil and gas stocks, even as most global indices ended on a higher note. Investors booked profits in banking stocks on fears that RBI’s new norms on personal loans will hurt loan growth. “Although risk sentiment has returned to the markets in recent sessions, global uncertainty would continue to set trends and keep investors on a tight leash,” said Prashanth Tapse, Senior Vice President (Research), Mehta Equities Ltd.
In Asian markets, Seoul and Hong Kong settled lower, while Tokyo and Shanghai finished in the green. European markets were trading with gains. US markets ended on a mixed note on Thursday. Global oil benchmark Brent crude climbed 0.77 percent to USD 78.02 a barrel.
Foreign Institutional Investors (FIIs) were buyers on Thursday buying equities worth Rs 957.25 crore, according to exchange data. The benchmark BSE climbed 306.55 points or 0.47 percent to settle at 65,982.48 on Thursday. The Nifty gained 89.75 points or 0.46 percent to 19,765.20. Meanwhile, S&P Global Ratings said India’s economic growth prospects should remain strong in the medium term, with GDP growing by 6-7.1 percent annually in fiscal years 2024-2026.
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