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Sensex plunges 334 pts as fiscal deficit concerns spook investors

For the week, 30-pack Sensex declined 0.85 per cent while 50-pack Nifty shed 1.19 per cent.

, ETMarkets.com|
Dec 06, 2019, 04.14 PM IST
HDFC, SBI and IndusInd Bank were among the major drags on Sensex.
NEW DELHI: A fall in bank stocks send benchmark indices lower on Friday, a second straight session of fall for Sensex and Nifty, even as global environment remained favourable. Analysts blamed lack of rate cut from RBI and concerns over rising fiscal deficit for weak market sentiment.

BSE flagship index Sensex ended 334 points or 0.82 per cent lower at 40,445 while its NSE counterpart Nifty closed below the 12,000 mark at 11,921.50, down 97 points or 0.81 per cent.

HDFC, SBI and IndusInd Bank were among the major drags on Sensex.

For the week, 30-pack Sensex declined 0.85 per cent while 50-pack Nifty shed 1.19 per cent.

The advance-decline ratio on BSE stood at 1:2, indicating that for every three stocks that traded, two declined.

Market at a glance
In the Sensex pack, seven stocks ended higher while rest ended lower with YES Bank falling the most at 9.82 per cent.

Shares of YES Bank declined after Moody's Investors Service downgraded the private lender’s credit ratings, citing stressed assets and low loss-absorbing buffers against those assets. It also assigned a 'negative outlook' to the company.

SBI, IndusInd Bank, Tata Motors, M&M and HDFC were among stocks that joined YES Bank on the losers list.

However, Kotak Mahindra Bank with a gain of 1.48 per cent emerged as top gainer, followed by Tata Steel, RIL, Asian Paints and TCS.

Shares of Vodafone Idea shed 5.34 per cent to close at Rs 6.92 apiece after company chairman Kumar Mangalam Birla said that the teleco "will have to shut shop" in absence of any government relief.

Sectorally, however, telecom was the only sector that shut shop in the green. All other sectors on BSE ended lower. BSE Auto and BSE Finance were the top losers.

Broader market trailed benchmarks, with BSE Midcap shedding 1.26 per cent and Smallcap sliding 0.86 per cent.

Expert Take
“Clouds over economic growth outlook and premium valuation influenced investors to stay away from rate sensitive stocks. While rising 10 year yield due to spike in inflation and potential slip in fiscal path may result near term consolidation in the market,” -- Vinod Nair, Head of Research Geojit Financial Services.

Global markets
World shares ticked up, buoyed by comments from US President Donald Trump that talks aimed at dialling down the damaging trade war with China were "moving right along". Trump's relatively upbeat tone in comments on Thursday was enough to encourage riskier bets by investors, despite a lack of agreement over whether existing tariffs should be dropped as part of an initial deal to ease the long standoff.

European shares, including the broader Euro STOXX 600, gained 0.3 per cent in early trade, with indexes in Frankfurt and Paris up by similar amounts, Reuters reported.
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