New Delhi: The S&P BSE Sensex snapped four weeks of gaining spree, dropping sharply on profit-bookings and concerns that RBI would hike rates further to curb high inflation.
After riding high on the back of a month-long rally, the Sensex tumbled 536 points to end the week at 19,727.27.
The market sentiment also dampened after US Federal Reserve Bank said on September 20 that there could be a small stimulus reduction at its next meeting in October.
RBI, under its new Governor Raghuram Rajan, last week unexpectedly raised the repo rate to 7.5 per cent from 7.25 per cent, saying inflation had to be lowered to more tolerable levels. As a result, markets reacted sharply and shares tanked heavily.
Bank stocks fell after global rating agency Moody's cut the senior unsecured debt and local currency deposit rating of State Bank of India, the country's largest lender.
The market mood was choppy with participants churning their portfolios due to expiry of monthly derivative contracts on Thursday, brokers said.
The Sensex resumed lower at 20,060.82 and hovered in a wide range of 20,199.81 and 19,658.64 before finishing at 19,727.27, posting a loss of 536.44 points or 2.65 per cent, over the last week's close.
The 30-share BSE barometer gained a healthy 1,744.27 points, or 9.42 per cent, in the previous four weeks.
The NSE 50-share Nifty also dropped by 178.90 points, or 2.98 per cent, to end at 5,833.20. The key index rose 540.35 points, or 9.88 per cent, in the last four weeks.
The market ended lower even after receiving indications from RBI that it would take measures to provide adequate liquidity in the financial system and ease norms for providing swaps to banks borrowing funds from overseas.
Banking and realty stocks, which are sensitive to interest rates, declined along with refinery, PSU and capital goods shares.
Meanwhile, foreign institutional investors continued their buying spree, pumping in a net of Rs 603.95 crore during the week, including the provisional figure of September 27, as per the data issued by the stock exchanges.
Twenty out of the 30 Sensex shares ended lower, while the remaining finished with gains.
Among the major sectoral indices, S&P BSE-bankex fell 7.25 per cent followed by realty at 7.13 per cent, oil & gas at 4.44 per cent, PSU at 2.49 per cent, consumer goods at 1.64 per cent and S&P BSE-FMCG dropped 1.39 per cent.
Ignoring the negative trend, the S&P BSE-HC rose by 1.55 per cent.
Among the Sensex pack, major losers were Jindal Steel at 9.20 per cent, HDFC Bank at 7.48 per cent, Maruti Suzuki at 6.70 per cent, ICICI Bank 6.48 at per cent, SBI at 6.00 per cent, Bharti Airtel at 5.59 per cent, ONGC at 5.46 per cent, RIL at 4.80 per cent, HUL at 4.67 per cent, Tata Steel at 4.18 per cent, Mah & Mah at 3.74 per cent and L&T dipped 3.47 pct.
Major gainers were BHEL at 6.43 per cent, Sun Pharma at 4.09 per cent, Hero Moto at 3.20 per cent and Dr Reddy's Lab shot up 2.18 per cent.
Total turnover at BSE and NSE dropped to Rs 8,461.06 crore and Rs 55,135.00 crore, respectively from the last weekend's level of Rs 10,307.45 crore and Rs 66,173.74 crore.
Forex: The rupee snapped its 3-week gaining spree, by slipping 28 paise to finish at 62.51 against the American currency on month-end dollar demand from importers and banks ahead of the current account deficit data release on Monday.
Fall in local equity market on repo rate hike by Reserve Bank last week also affected rupee's value against the dollar, a forex dealer said.
However, the decline was limited by a sluggish dollar overseas and sustained capital inflows, he added.
The local currency resumed lower at 62.55 per dollar as against the last weekend's level of 62.23 per dollar at the Interbank Foreign Exchange (Forex) Market and dropped further to 62.90 per dollar before ending the week at 62.51 per dollar, witnessing a loss of 28 paise or 0.45 per cent. It moved in a range of 61.76 and 62.90 per dollar.
It had gained by 347 paise or 5.28 per cent in the previous three weeks.
