Dalal Street's worst week since 2009

Bharti Airtel only gainer on Sensex this week; BHEL biggest loser

Dalal Street went through its most turbulent week in nearly seven years, with benchmark indices crashing about seven per cent and several bluechip stocks plummeting even further. The 30-share Sensex lost 1,631 points, or 6.6 per cent, to close at 22,986, while the broad-based Nifty lost 508 points, or 6.78 per cent, to end the week at 6,980.95.

The losses were on the back of a massive sell-off by global investors as they turned risk averse because of gloomy outlook for global economy. Foreign investors pulled out over $400 million from stocks during the week, extending their 2016 selling tally to over $2 billion.

Benchmark indices went through yet another volatile session on Friday with the Sensex fluctuating 560 points. The index ended 34.3 points, or 0.15 per cent higher, ending its four day losing streak, as the global rout eased after oil prices rebounded from their 12-year lows.  Investors, however, remained cautious as markets in China were set to reopen on Monday after a week-long Lunar New Year holiday.

“The Indian market is being dragged into the global turmoil, with little end in sight,” analysts at Bank of America Merrill Lynch, led by India equity strategist Sanjay Mookim, said in a note. “There is the possibility Budget 2016 will provide support. Limited spending headroom and the imperative to support the rural economy mean the budget is unlikely to provide meaningful catalysts.”

Most global markets fell during the week as investors were spooked by slide in oil prices, falling bank shares, especially in Europe and uncertainty over Federal Reserve’s future course of action.

Japanese market fell nearly 13 per cent, most European markets fell over 5 per cent and the MSCI Emerging Market index fell 4 per cent. Crude oil prices declined over 10 per cent during the week, while gold prices rallied over 5 per cent on safe-haven buying. Meanwhile, the rupee ended the week at 68.23, compared with previous week close of 67.65 against the dollar.

Barring Bharti Airtel, all Sensex components ended with losses during the week. Bharat Heavy Electricals Limited (BHEL), the government-owned power-equipment manufacturer, ended the week with 21.3 per cent losses after dropping 13 per cent on Friday. Adani Ports & SEZ and ONGC were the other big losers dropping 15.4 per cent and 12 per cent respectively. Bharti Airtel was the only gainer on Sensex adding 6 per cent during the week.

“For any sustainable recovery, Nifty should stabilise first but that seems difficult, considering the pace of decline in the passing week. We expect the prevailing slide to extend further with next major support now at 6,800 in Nifty,” said Jayant Manglik, president-retail distribution, Religare Securities.