Sensex takes 249 pts hit on weak global cues; snaps 2 consecutive weeks of gains

Domestic stocks retreated sharply for the third straight session on Friday, ending the week on a dismal note with key indices posting their first weekly loss after two consecutive weeks of gains. Reeling under selling pressure throughout the session today, the benchmark Sensex felt the global heat as weak global markets sentiment unsettled investors, leading to unwinding of position in power, banking, automobile, banking and realty shares. [caption id=“attachment_2533550” align=“alignleft” width=“380”]  Reuters[/caption] Tracking overnight losses in US markets and subsequent decline in other Asian indices, the benchmark Sensex dropped 263 points to touch an intra-day low of 25,623.71. The 30-share BSE S&P Sensex finally wrapped up the session at 25,638.11, down 248.51 points, or nearly 1 percent lower. The broader 50-stock CNX Nifty closed the session at 7,781.90, down 82.25 points, or nearly 1.1 percent from previous close. In the last three session, the Sensex crumbled 531 points or 2 percent, while dropping 490 points, or 1.9 percent over the preceding week. Today’s market breadth displayed a weak trend, with 1,568 stocks declining against 1,176 advances on BSE. On the international front, other key Asian indices such as Japan’s Nikkei, China’s Hang Seng and Shanghai Composite fell over 1-2 percent, while major European gauges, too, were trading weak in their mid-day trade. Market participants said the lower-than-expected European Central Bank’s stimulus package announcement and smaller rate cut yesterday disappointed investors. Its rate cut of 0.10 percentage point, to -0.30 percent, was smaller than a 0.15 to -0.20 percentage point cut many traders expected. The central bank did not increase the amount of government bonds it buys while the six-month extension of the programme was perceived as bare minimum, given traders looked for an extension of one year or even making it an open-ended plan, a Reuters report said. Also, nervousness among investors ahead of the US Federal Reserve’s rate-setting meeting on December 15-16, which is expected to hike rate for the first time in nearly a decade, is keeping markets on the edge, said dealers. Taking the hit, stocks of HDFC & M&M dropped 2.4 percent each to Rs 1,171.95 and Rs 1,316 respectively. Similarly, shares of NTPC fell 2.3 percent to Rs 130.80, ITC declined 2.2 percent to Rs 335.60, ICICI Bank eased 1.7 percent to Rs 261.45 and Tata Motors was down 1.4 percent at Rs 399.90. Other losers such as Reliance Industries, HDFC Bank, Bajaj Auto, Dr Reddy’s and ITC were down around a percent each.