Huge unwinding of long positions by foreign portfolio investors (FPIs) in the index futures market on Friday, ahead of crucial payrolls data in the US, saw India’s stock markets snapping its eight days’ winning streak.
The Sensex fell 0.66 per cent or 415 points to close at 62,868. Nifty declined 0.62 per cent or 116 points to close at 18,696. FPIs net sold index futures to the tune of ₹3,917 crore, while domestic institutional investors (DIIs) were net sellers of ₹1,109 crore in the same segment.
The broader market, however, bucked the trend and ended in the green, with the BSE Midcap gauge settling 0.80 per cent higher and Smallcap index climbing 0.70 per cent.
Among sectoral indices, BSE Power fell 1.23 per cent, Auto declined 1.12 per cent, Utilities (1.10 per cent), Teck (0.52 per cent), Consumer Durables (0.46 per cent), IT (0.41 per cent) and Bankex (0.32 per cent). However, BSE Commodities, BSE Industrials, Capital Goods, Telecommunication and Metal indices were among the gainers.
US Payroll data
The US payroll data, which came after India’s markets closed, indicated that average hourly earnings of the non-farm workers rose twice as much as the forecast. It showed that wages were still strong and moving higher, , giving rise to doubts on the pace of anticipated slowdown on the interest rate hikes by the US Federal Reserve.
Markets can rally once the Fed pledges that it would be less aggressive with its rate hikes than it has been so far, analysts said.
In the stock futures segment too, FPIs were net sellers worth ₹2,043 crore. But in the cash segment, FPIs were buyers on Friday to the tune of ₹214.76 crore, data showed.
At around 7:30 p.m. India time, the US index futures including the Dow Jones, S&P and Nasdaq fell between 1.35 per cent and 2 per cent on the back of strong payrolls data.