India’s broader NSE index fell yesterday after hitting a record high for a third straight day as investors took profits in blue-chips such as ICICI Bank, while IT outsourcing firms declined after Wipro’s US dollar revenue growth lagged rivals.
The stock markets also tracked global shares lower after a week of largely reassuring economic signals but rising political tensions.
Sentiment was also hit as foreign portfolio investors sold Rs2.80bn of Indian index futures and options contracts on Thursday.
In the near term, the markets would be driven by the ongoing earnings season, with Larsen & Toubro, ICICI Bank and Maruti Suzuki India reporting results in the coming week and the central bank’s policy review on August 5.
“Risk reward has become slightly unfavourable. Correction is part of the course. But, it’s still a buy-on-dips market,” said Jagannadham Thunuguntla, chief strategist and head of research at brokerage SMC Global Securities.
The broader NSE index fell 0.51%, or 40.15 points, to end at 7,790.45.
Still, the index rose 1.65% for the week, marking its second consecutive weekly gain. The NSE earlier rose 0.13% to hit its third consecutive record high at 7,840.95.
The benchmark BSE index lost 0.55%, or 145.10 points, to end at 26,126.75, while rising 1.9% for the week. It earlier rose 0.1% to hit its second straight all-time high at 26,300.17.
Meanwhile the rupee ended marginally higher yesterday, as heavy dollar demand from importers to meet month-end commitments was offset by greenback sales from custodian banks, continuing a pattern of largely range-bound trading.
Still, the rupee fell 0.3% for the week, posting its first weekly loss in three in a week dominated by flows rather than major events or factors.
Traders said they will continue to monitor movements in other Asian currencies and moves in domestic shares for clues in the near-term.
“There were some heavy dollar inflows with custodian banks which helped offset the demand from oil firms and other importers,” said Vikas Babu Chittiprolu, a senior foreign exchange dealer with state-run Andhra Bank.
The partially convertible rupee closed at 60.1025/1125 per dollar, compared with 60.12/13 on Thursday.
