After hitting record highs in the previous week, the equity benchmark indices Sensex and Nifty slipped in the red during the week, falling 1% each and ending below their respective 20 DMAs. RBI’s hawkish than expected tone amid priority to tackle inflation dampened the sentiment during the week, said market experts.
The Sensex ended Friday’s session at 62,181, down 389 points, while Nifty fell 113 points to end the week at 18,496. IT stocks remained the top drags for the market, with the Nifty IT index falling over 6%. In contrast, Nifty PSU bank was the biggest gainer during the week, up over 4%.
Flows from foreign portfolio investors also turned negative ahead of the big US FOMC meeting scheduled next week.
Speaking on the weekly action of the markets, Hi, Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, said “FPI’s have been net sellers of Indian equities during the week. Domestic markets reacted to 35 bps repo rate hike by the RBI MPC. The RBI MPC expressed optimism on growth but tackling inflation will likely be a key focus. Oil prices saw a sharp decline this week and that is positive for India. Impact of easing of covid restrictions by China needs to be watched out. In the US, the 10 year treasury yields have seen a steady decline over the past few weeks. The 10 year US treasury yield is now below 3.5% compared to a high of 4.22% in November 2022. Globally, markets are now awaiting US FOMC rate hike action and commentary in their scheduled meeting next week.”
