Sensex, Nifty down 1 % each; Bank Nifty slips over 700 points

After benchmark indices tanked nearly 2 per cent each amid FIIs selling pressure and weak global cues on Thursday, the Indian markets opened in the red on Friday. Nifty 50 continued to remain below 18,000-level, while Sensex too struggled to breach the 60,000- mark. The two indices opened at 17,833.05 and 59,857.33, respectively on the last trading day of the week.  Nifty Bank opened at 39,424.55, however, slipped 238 points to trade at 39,270.65. Nifty loses 200 points (1.14%), Sensex down 800 points (1.36), while Bank Nifty shed over 700 points, minutes after opening.  

NTPC, Sun Pharma and IndusInd Bank dragged the Nifty the most, while JSW steel, Adani Ports and Tata Steel gained marginally in otherwise negative market.

Decoding the reason, V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said, "With the Nifty moving below the 20 Day Moving Average, the market has turned distinctly weak. The major drag on the market now is the sustained FII selling which touched Rs 3818 cr yesterday. This comes after foreign brokerages like Morgan Stanley, Nomura and UBS downgrading India on excessive valuations. When smart money selling turns aggressive, retail exuberance would be overwhelmed. This is happening now. Investors need not rush in to buy now; the 'buy on dips' strategy, which worked well since April last year, may not work when FIIs are selling massively. So investors may wait and watch the trend before taking decisions. However, switching from expensive stocks in the broader market to high quality large-cap growth stocks may be a good idea.

Government asking IRCTC to share 50% convenience fee with the Railway Ministry is yet another instance which should warn investors of undue optimism while investing in PSU stocks. Enhancing shareholder return is not the objective of PSUs. So investors have to be careful while chasing PSU stocks, even if they are cheap"

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Earlier in the preopen, Nifty reclaimed 18,000, however, Sensex struggled to go past 60,000-mark as 6 shares advanced and 44 declined on the former index, while the latter saw 16 shares advancing and 14 declining. 

Meanwhile, majority of Asian markets were trading in the red on Friday. Nikkei 225 was down 43 points to 28,776, Hang Sang down 104 points to 25,451 and the Asia Dow Index USD was trading flat at 3900, losing 6 points around 8.15 am. 

Earlier, major US stock market indices ended Friday with good gains of 0.68% to 1.39%. Dow Jones rose 240 points to 35,730, Nasdaq Composite 212 points to 15, 448 and S&P 500 also gained 45 points at 4596 in Friday's closing. Domestic equity benchmarks Nifty 50 and S&P BSE Sensex fell sharply by nearly 2 per cent each in the Thursday's closing. The selling pressure pushed Nifty50 below 18,000-mark and Sensex down 60,000-level.

(It's a developing story. Pls check back for the updates.)