MUMBAI: The Sensex Friday tumbled 162 points, extending its losing run to the sixth day, on fag-end selling after RBI dashed hopes of a rate cut and Samajwadi Party’s sudden announcement of candidates for 2014 polls made investors nervous over the political situation.
Euro-zone debt worries and rupee trading above 55-level against dollar also impacted the sentiment.
After a better start at 18,563.32, the Sensex erased early gains of around 92 points after selling in rate-sensitives gathered pace in the last half hour of trading.
RBI Governor Mr D Subbarao said in Pune that at 7.45 per cent inflation is certainly “quite high”. Traders said after headline inflation fell to an 8-month low in October, investors had hoped for a rate cut. However, Subbarao’s comments poured cold water on such hopes, they added.
The sentiment took a further hit when Samajwadi Party announced the first list of candidates for 2014 polls, taking everyone by surprise.
The 30-share Sensex finally closed 162 points, or 0.88 per cent, lower at 18,309.37 -- a level last seen on September 20.
ICICI Bank led the 24 losers in 30-share Sensex, followed by Tata Motors, SBI, Bhel, Maruti and HDFC. The NSE 50-share Nifty also dropped by 56.95 points, or 1.01 per cent. To finish at nearly two-month low of 5,574.05. Barring Hong Kong and Japan which closed with gains, other Asian markets ended up to 0.77 per cent lower. For the week, the Sensex and the Nifty were down by about 2 per cent on concerns over the so-called US ‘fiscal cliff’, worries over India’s fiscal deficit and weak macro data, said Dipen Shah, Head of PCG Research, Kotak Securities.
The mood also turned cautious ahead of the Winter session of Parliament, which starts on November 22. Key economic agenda for the session includes amendment to the Insurance Bill to raise FDI cap from 26 to 49 per cent, Banking Regulation Amendment Bill and Direct Taxes Code.
Weakness in the European markets in their afternoon trade after data showed the Euro-zone had slipped into recession, also affected the market sentiment. Key indices in London, France and Germany declined by 0.48-0.82 per cent.
Back home, major losers from the Sensex pack were ICICI Bank (2.65 per cent), Tata Motors (2.64 per cent), Cipla (2.33 per cent), HUL (2.27 per cent), SBI (2.13 per cent), Hindalco (2.11 per cent), BHEL (1.94 per cent), Gail India (1.94 per cent), Maruti Suzuki (1.89 per cent), HDFC (1.78 per cent), L&T (1.55 per cent), Tata Steel (1.52 per cent), Sterlite Ind (1.52 per cent), Bajaj Auto (1.20 per cent), RIL (1.18 per cent), Tata Power (1.05 per cent) and Hero Motocorp (1.02 per cent).
Among the sector indices, the BSE-Realty dropped by 3.36 per cent, followed by Bankex (1.61 per cent), BSE-Auto (1.50 per cent), BSE-CG (1.44 per cent), BSE-FMCG (1.36 per cent) and BSE-Power (1.14 per cent).
The market breadth continued to remain negative as 1,738 stocks finished with losses while 1,112 closed with gains. The total market turnover dropped to Rs 2,387.83 crore from Rs Rs 2,526.45 crore on Thursday.