Market snaps two-week gains, sheds two per cent on US rate hike fears
Mumbai: The BSE Sensex fell nearly 2 per cent at 25,638.11 and Nifty tanked below the key 7,800-mark during the week under review amid fears of US Fed rate hike this month. Stock momentum in the first two days was positive but lacklustre on higher July-September GDP data and likelihood of passage of the GST Bill. Though RBI kept the key repo rate steady at 6.75 per cent, the market enthusiasm worn out from the third session amid combined worries over data of November PMIs manufacturing which fell to 25-month low, and stagnation in services sector after its four straight months expansion.
The selling pressure also aggravated by US Fed Chair Janet Yellen's comments on first interest rate hike nearly over a decade spurring concerns of flight of capital from emerging market. Sentiments also took a hit by the sell-off in global equities reacting to the much hyped higher stimulus measures from European Central Bank bond buying programme which was shunned and fell short of market expectations. Domestic enthusiasm also dissuaded by heavy FII sell-off and volatile rupee valuation which lingered around over two year lows.
The Sensex resumed higher at 26,142.53 and hovered between a high of 26,256.42 and low of 25,623.71 before finishing the week at 25,638.11, showing a fall of 490.09 points or 1.88 per cent. The 50-share Nifty also dropped by 160.80 points or 2.02 per cent to 7,781.90. Selling was led by Banking, Auto, Consumer Durables, Teck, FMCG, PSUs, Power, Capital Goods and IT sectors. While the broader midcap witnessed selling, smallcap shares saw some buying activity.
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