Indian shares snapped their 5-day record-setting rally on Friday, as investors chose to book profits at higher levels amidst global growth concerns. The BSE Sensex shed 170 points to close at 72,240, while the NSE Nifty 50 settled at 21,726, down over 50 points.
The markets had scaled lifetime peaks for the fifth straight session in the previous trade, buoyed by the recent policy pivot by global central banks towards lower interest rates. But expectations of further large gains from current levels led to profit-taking.
Among major Sensex movers, Tata Motors, Nestle, HUL, Tata Steel, and Bajaj Finance saw buying interest. On the flipside, heavyweight finance stocks like SBI, Infosys, Titan, and IndusInd Bank faced selling pressure.
The broader markets though continued to outperform the large-caps, with mid-caps and small-caps climbing up to 0.85% each. Only the Nifty 100 index of most valued companies closed mildly lower.
On the sectoral front, IT, PSU bank, and oil & gas shares lagged the most. But auto and FMCG stocks bucked the weak trend on the back of stock-specific action.
Vinod Nair, head of research at GEOJIT Financial Services, said the start of 2023 is likely to see a continuation of the ongoing rally led by global cues and domestic growth optimism. But he cautioned that valuations in the large-cap space remain stretched, restricting major upsides from here on.
On Friday, the rupee settled unchanged at 83.20 against the US dollar. FIIs purchased equities worth ₹4,359 crore yesterday per exchange data, providing support to the markets. The direction of foreign flows will remain a key driver going ahead.
