 "Mkts end in red for 3rd straight week; FPI selloff in October tops $9 bn")
A sharp rally in banking stocks helped the equity benchmark indices snap their three-day losing streak, but the gains were not enough to erase the weekly deficit. The Sensex and Nifty 50 ended in the red for the third consecutive week on Friday, marking their longest weekly decline since August 2023.
The Sensex ended the session at 81,225, with a gain of 218 points, or 0.3 per cent. The Nifty 50 index ended at 24,854, up 104 points, or 0.4 per cent.
For the week, Sensex declined by 0.2 per cent and Nifty by 0.4 per cent.
During the past three weeks, the Sensex shed 4,347 points, or 5.1 per cent, while the Nifty was down 1,325 points, or 5.1 per cent.
The losses come amid unprecedented outflows from foreign portfolio investors (FPIs).
On Friday, FPI sold shares worth Rs 5,486 crore, while domestic institutional investors (DIIs) were the net buyers to the tune of Rs 5,215 crore.
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So far this month, FPIs have pulled out Rs 77,000 crore, or $9.2 billion, from domestic stocks—the highest-ever in a calendar month.
Experts say a large part of the selling is on account of investors pruning their India exposure to invest in the Chinese market, where valuations are compelling.
The uncertain outlook of the US rate cut after robust economic data has further added to the concerns of investors.
The 10-year US bond yield was trading at 4.1 per cent reflecting doubts over how quickly the central bank will ease policy.
The US retail sales data for September, which was released this week, beat forecasts and rose by 0.4 per cent against 0.1 per cent in August.
The numbers gave credence to the fact that the economy is showing no signs of slowdown.
"We expect consolidation to continue in markets because of mixed global cues and lack of domestic triggers. However, stock-specific action will be seen as being driven by the quarterly earnings results," said Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services.
The market breadth was mixed, with 2,014 stocks declining and 1,923 advancing.
ICICI Bank, which rose 2.5 per cent, and Axis Bank, which rose 5.6 per cent, were the biggest contributors to the Sensex gains. Shares of Infosys declined 4.6 per cent, most among Sensex and Nifty components.
Its shares fell after revenue growth forecast fell short of the Street's expectations. The decline in the shares of Infosys sparked a sell-off in other IT stocks, with the Nifty IT index shedding 1.5 per cent.
Earlier in the week, Bajaj Auto's statement about weak demand during the festival demand raised concerns about a slowdown in the discretionary spending and spared a selloff in auto stocks.
“The initial set of results from private banks were positive, building an expectation that the upcoming set of financial results in the weekends will also be optimistic. The metals also performed well, benefiting from a slightly better-than-expected growth in China’s Q3 GDP. Consecutive rate cuts by the ECB supported rate-sensitive stocks,” said Vinod Nair, head of research at Geojit Financial Services.