The Nifty 50 index fell 490 points on Friday to end just above the 22,800 mark. This is the fifth straight weekly loss for the index. The last instance of the index declining for five weeks in a row was between July and August last year, when the index fell for six straight weeks.
35 stocks on the Nifty 50 index ended with losses for the week. The broader markets were no different, with over 2,200 stocks on the NSE ending the day with losses, while 280 ended higher. The Nifty Midcap index ended 1.3% lower for the week, while the Smallcap index ended 0.6% lower.
Multiple factors triggered this fall on the Nifty on Friday, especially after a two-day relief rally, that saw the index recover nearly 1,000 points from the lows made on Monday. Here’s a look at some of them:
Weak Global Cues
Indian equities had to react to two days of global action as Thursday was a market holiday. The index though took cues from the overnight Wall Street action, where indices saw a sharp drop, offsetting all the gains they made on Wednesday.
Currency & Bond Yields
The weakness in global markets also had an impact on the currency, with the rupee falling to a new low of 94.84 against the US Dollar and is set for its biggest fall in a financial year since financial year 2012.
Not just the currency, but bond yields also bore the brunt of the hardening yields across the globe due to the rising geopolitical uncertainties.
The 10-year Government Bond Yield hardened to 6.94%, leading to a sharp drop in shares of PSU Banks and some NBFCs as well.
Index Heavyweights Underperform
Reliance Industries and HDFC Bank were the two biggest laggards on the Nifty 50 today, contributing to nearly 150 points of the index fall.
HDFC Bank was also removed by Chris Wood of Jefferies from his GREED and fear portfolio. You can read more on that here.
Weekend Uncertainties
This has been the fourth Friday where the Nifty has either ended lower, or has not managed to sustain at higher levels.
Going into the weekend, traders would want to remain light on positions, since most of the major announcements come over the weekend on the Iran war front.
The Road Ahead
Monday’s session will also be the monthly options expiry for the NSE contracts, as Tuesday will be another market holiday on Dalal Street.
