Indices decline for 3rd straight week; Sensex slips 202 pts, ends below 48K

The benchmark indices logged their third consecutive weekly loss on Friday as the deadly second wave of coronavirus infections raised concerns over business recovery because of lockdown-like curbs imposed across many states.

The Sensex came off nearly 400 points from the day’s high to end at 47,878, down 202 points, or 0.42 per cent, over its previous day’s close. The Nifty50 fell 65 points, or 0.45 per cent, to end at 14,341, ending below the 100-day moving average (DMA) — considered a crucial technical support. For both, this is the longest run of weekly losses since May 22. The Sensex has declined more than 4 per cent over the past three weeks. Foreign investors have sold shares worth over $1 billion during this period.

“Domestic equities do not look to be inspiring at the moment. The sharp rise in Covid-19 cases across the country and enhanced mobility restrictions imposed by a number of states are expected to remain key overhangs for the market,” said Binod Modi, head of strategy at Reliance Securities.

The Sensex has retreated more than 8 per cent from its all-time high, touched on February 15, nearing losses read as a technical correction.

“The short-term texture of the Nifty/Sensex is still bearish and likely to continue in the near future. We are of the view that, 14,250/47,450 would be the immediate support level for the bulls. Below this we can expect one more leg of correction up to 14,150/47,150. Further downside may also be possible, which could drag the index till 14,000-13,900/46,500-46,000. On the flip side, 14,500/48,300 would be the immediate hurdle for the Nifty/ Sensex, above this uptrend structure will continue up to 14,700/49,100,” said Shrikant Chouhan, executive vice-president, Equity Technical Research at Kotak Securities.

Fourteen of the 19 sector sub-indices compiled by BSE gained, led by a gauge of power stocks. The market breadth was mixed, however, with almost equal number of gainers and losers on the BSE.