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Profit-booking by operators and investors on fears of hike in interest rates by the Reserve Bank of India, coupled with persistent selling by foreign institutional investors, pulled down the BSE benchmark Sensex by 466 points during the week.
The key index dropped to the lowest level in more than a week as high inflation stoked macroeconomic problems in the world’s second-fastest growing major economy.
Also, caution prevailed as the central bank is seen raising key short-term interest rates at a policy review early next week.
Volatility was high as traders rolled over positions in the futures and options (F&O) segment following expiry of the near-month April 2011 contracts.
Realty, capital goods, banking, oil & gas, metal and power sectors were the major losers of the week.
The 30-share Sensex declined by 466.27 points or 2.38 per cent to end the week at 19,135.96, its lowest closing level since April 19. The S&P CNX Nifty fell by 135.2 points or 2.3 per cent to finish at 5,749.50 on the NSE.
Reliance Industries slumped by 5.58 per cent on disappointing Q4 2011 results. However, Oil and Natural Gas Corporation (ONGC), gained 1.55 per cent.
Food inflation inched up marginally to 8.76 per cent for the week ended April 16 on the back of rising prices of fruits, protein-based items and onions.
HDFC Bank slipped by 4.63 per cent, while State Bank of India declined by 1.91 per cent.
IT stocks fell as Infosys, TCS and Wipro said that margins will be under pressure due to hike in wage costs. TCS shed 2.65 per cent and Wipro slumped 2.8 per cent.
Realty major DLF, which tanked 9.78 per cent, was the top loser from the Sensex pack. Other losers were Jaiprakash Associates (8.85 per cent), L&T (6.22 per cent), RCom (6.11 per cent), Jindal Steel (5.84 per cent), Reliance Infrastructure (5.45 per cent), Hero Honda Motors (4.28 per cent), Cipla (3.84 per cent) and Tata Steel (2.23 per cent).
Among the major indices, the BSE-Realty dropped by 8.45 per cent followed by the BSE-Capital Goods 4.45 per cent, the Bankex 3.46 per cent, the BSE—Oil & Gas 2.92 per cent, the BSE-Metal 2.81 per cent and the BSE-Power lost 2.42 per cent.
Total turnover on the BSE and NSE stood at Rs 15,186.37 crore and Rs 63,045.24 crore, respectively, against the last week-end level of Rs 23,630.21 crore and Rs 50,834.00 crore.
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