Sensex tumbles 715 pts as bears return after 2-day rally; logs weekly losses

Equity markets buckled under selling pressure on Friday after a two-session rally as selling emerged in IT, bank and energy stocks amid a bearish trend overseas following hawkish comments from the US Federal Reserve.

A sharp drop in the rupee and unabated foreign fund outflows added to the gloom, analysts said.

The BSE benchmark Sensex tanked 714.53 points or 1.23 per cent to end at 57,197.15. The broader NSE Nifty slumped 220.65 points or 1.27 per cent to 17,171.95.

SBI was the biggest laggard in the 30-share Sensex pack, losing 3.08 per cent, followed by HUL, IndusInd Bank, Dr Reddy's, Axis Bank, Bajaj Finserv, Infosys and ICICI Bank.

On the other hand, M&M, Bharti Airtel, Maruti Suzuki, Asian Paints, ITC and HCL Technologies were the gainers, climbing up to 0.98 per cent.

"This excessively volatile market without any clear direction is being influenced on a daily basis by two factors - one, external and two, internal. The external factor is the erratic movement in the mother market US where the S&P 500 and Nasdaq go up by around 2 per cent one day and go down by around 2 per cent the next day.

"The internal factor influencing the market is the see-saw tussle between FIIs and DIIs. Both these external and internal factors are erratic now and that's why the market is volatile without any direction," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

On a weekly basis, the Sensex lost 1,141.78 points or 1.95 per cent, while the Nifty shed 303.70 points or 1.73 per cent.

"The Indian equity markets have been gyrating in the past few days after a healthy pullback witnessed since the geopolitical crisis-led lows seen in the early part of March. While the headline indices seem to be in a consolidation mode, the larger activity seems to have shifted to the broader markets...

"The markets seem to be slightly cautiously positioned, as the Q4FY22 earnings season has begun on a mixed note with small disappointments from a couple of large sectoral majors. Hence, investors might prefer to wait out for more results to be announced and hear out the accompanying commentaries to gauge in case there are any concerns of earnings cuts creeping in," said Milind Muchhala, Executive Director, Julius Baer.

In the broader market, the BSE midcap gauge declined by 0.71 per cent and the smallcap index dipped 0.38 per cent in Friday's session.

As many as 1,956 stocks declined, while 1,451 advanced and 124 remained unchanged.

All BSE sectoral indices settled lower, with bank falling the most by 2.19 per cent, followed by metal (2.17 per cent), finance (1.70 per cent), healthcare (1.57 per cent) and basic materials (1.45 per cent).

World stocks dived after US Federal Reserve Chairman Jerome Powell indicated a 50 bps rate hike in May amid efforts to rein in rocketing inflation.

Elsewhere in Asia, markets in Tokyo, Hong Kong and Seoul settled lower, while Shanghai ended marginally higher.

Markets in Europe were trading lower in the afternoon session.

Stocks in the US had ended lower on Thursday.

Meanwhile, international oil benchmark Brent crude declined 1.60 per cent to USD 106.6 per barrel.

The rupee declined 32 paise to close at 76.49 (provisional) against the US dollar on Friday, amid a firm greenback in the global markets.

Foreign institutional investors continued their selling spree, offloading shares worth Rs 713.69 crore on Thursday, according to stock exchange data.