Benchmark equity indices Sensex and Nifty erased early gains to end lower on Friday amid selling pressure in metal, oil & gas and PSU banking stocks, while investors remained cautious due to surging crude oil prices and rising inflation concerns.
The 30-share BSE Sensex declined 160.73 points, or 0.21 per cent, to close at 75,237.99 after fluctuating between gains and losses throughout the session. The benchmark index had initially surged nearly 470 points in early trade before losing momentum in the latter half of the day. Similarly, the broader NSE Nifty slipped 46.10 points, or 0.19 per cent, to settle at 23,643.50, snapping its two-session winning streak.
Among the major laggards on the Sensex were Tata Steel, State Bank of India, Eternal, Reliance Industries, UltraTech Cement, Mahindra & Mahindra, Bharat Electronics Ltd, Larsen & Toubro, Trent, Axis Bank and Asian Paints.
On the other hand, Infosys, Tech Mahindra, PowerGrid, Adani Ports, Maruti Suzuki India, Bharti Airtel, Kotak Mahindra Bank, Hindustan Unilever and Sun Pharmaceuticals emerged as the top gainers.
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Vinod Nair, Head of Research at Geojit Investments Ltd, said investors turned cautious following the recent market rally as rising bond yields, weakness in the rupee and fresh fuel price hikes reignited inflation concerns.
He noted that favourable valuations and strong fourth-quarter earnings have helped limit the downside in equities. According to him, investor focus has now shifted towards possible fiscal and monetary measures aimed at supporting the rupee and stabilising the country’s balance of payments.
“Globally, rising bond yields have interrupted the AI-driven rally in markets. Near-term market direction is likely to depend on geopolitical developments, especially any progress regarding the reopening of the Strait of Hormuz, while the Trump-Xi meeting is being viewed as a key catalyst,” Nair said.
The rupee breached the 96 mark against the US dollar for the first time on Friday as elevated crude oil prices and inflationary worries continued to weigh on the domestic currency. It later settled at a record closing low of 95.94 (provisional) against the dollar.
Meanwhile, oil marketing companies increased petrol and diesel prices by Rs 3 per litre each to partly offset losses arising from soaring global crude oil prices linked to the Iran conflict. CNG prices in cities such as Delhi and Mumbai were also raised by Rs 2 per kg, adding to concerns over a possible spike in inflation.
Broader markets also witnessed weakness, with the BSE MidCap Select Index falling 0.78 per cent and the SmallCap Select Index declining 0.06 per cent.
Among sectoral indices, Metal was the worst performer, falling 1.98 per cent, followed by Realty (1.82 per cent), PSU Bank (1.80 per cent), Oil & Gas (1.79 per cent), Commodities (1.31 per cent), Energy (1.13 per cent) and Capital Goods (1 per cent).
In contrast, Information Technology, Focused IT, FMCG, Healthcare, Telecommunication and Services sectors ended in positive territory.
Market breadth remained weak on the BSE, where 2,471 stocks declined, 1,705 advanced and 169 remained unchanged. The overall market capitalisation of BSE-listed companies dropped by Rs 2.26 lakh crore to Rs 4,60,59,270.46 crore (USD 4.8 trillion).
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