Market slumps on global sell-off, dips 1,061 pts for the week

Both (BSE) Bombay Stock Exchange and (NSE) National Stock Exchange markets slumped further for the 2nd consecutive week following a massive sell-off in overseas stock markets triggered by a spike in global bond yields.

Overseas, US stock-market indexes did an about-face in late yesterday, booking sharp gains for the session, but recording the worst weekly losses in about two years, during one of the most frenetic stretches of trading on Wall Street.

Climbing bond yields and higher inflation have been partly to blame for igniting once-dormant volatility in the market.

Frantic capital outflows against the grim backdrop of a scary fall in domestic equities largely weighed on the trading front even as fears deepened over US Federal Reserve raising short-term interest rates near term.

Foreign investors remained net sellers and sold shares worth whopping Rs 7,380.26 crs during the week as the turmoil in global stock markets saw traders shun equities in favour of perceived safe havens.

Back home, trading for the week started on a dismal note a sell-off in global markets hit sentiments on domestic bourses which are already reeling under budget woes after Finance Minister Arun Jaitley had announced bringing the long-term capital gains (LTCG) tax in Union Budget 2018. As widely expected, Monetary Policy Committee (MPC), headed by RBI Governor Urjit Patel decided status-quo on the interest rate at 6 percent and maintained the reverse repo rate at 5.75 percent on Wednesday, while lowered the economic growth projection for 2017-18 to 6.6 percent, flagged concerns over the wider fiscal deficit.

The market incurred losses after RBI decision dragged down mostly rated sensitive banking and financial stocks.

Stocks advanced as bargain hunting emerged on Thursday after 7th-straight sessions of sell-off in the wake of a combination of domestic and global factors. The lesser hawkish stance of the Reserve Bank of India (RBI) in its monetary policy meeting, also supported the gains on the bourses.

In the week ended Friday, the Sensex slumped 1,060.99 points or 3.03 per cent to finish at 34,005.76, its lowest closing level since 4 January 2018. The Nifty 50 index tumbled 305.65 points or 2.84 per cent to end at 10,454.95, its lowest closing level since 3 January 2018. (The Sensex and Nifty dropped by 2,044.68 points or 5.76 percent and 614.70 points or 5.63 percent, respectively during past two week sessions).