Sensex closes 698 points lower, Nifty below 8,300 level

The effect of demonetisation of Rs 500 and 1,000 banknotes and intense selling pressure across the board pulled Indian market down during the last hour of trade on Friday.

The Sensex which opened at 27,344 level was hit by worries US President Donald Trump's policies would be inflationary, leading to higher US interest rates and denting the appeal of emerging markets.

It shed over 1 per cent till noon trade amid weak market sentiment but fell from 26,962 level to end at 26818  level, shedding 2.54 percent through the day.

Th Nifty too, fell 2.69 percent or 229 points to lowest closing level of 8296 since June 30 2016. The Bank Nifty which rose yesterday, anticipating huge deposits from the customers, shed 461 points today to close at 19738 levels. 

"The larger cause of worry is with the currency. In global markets, some of the currencies are getting hit very badly against the dollar, resulting in significant amount of economic damage to those countries," said Deven Choksey, managing director at KR Choksey Securities.

The SBI stock fell 3.09 per cent to Rs 272.90 on BSE after the bank reported a 35 per cent fall in Q2 net profit.

The Tata Chemicals stock fell 4.62 per cent amid reports that Bhaskar Bhat, non-executive, non-independent director, has resigned from the board of the company with effect from 10 November, 2016. The firm also announced a marginal increase in second-quarter earnings on Thursday after market hours.

Mahindra & Mahindra reported 27 percent rise in Q2  net profit. Its stock closed 6.02 percent lower on the BSE.

Shares of InterGlobe Aviation, Jet Airways and SpiceJet fell 1.51 percent, 3.44 per cent and 4.14 percent each on media reports the government would impose a new levy on some domestic flights.

The ministry of civil aviation has proposed the levy to help raise money to fund air travel between smaller towns and cities at a subsidised cost, according to the local media reports.

The Delta Corp stock was top loser on the BSE, falling 12.25 per cent. Manappuram Finance fell 12 per cent to Rs 89.90.

Market breadth was negative with 2,223 stocks closing lower against 460 advancing on BSE.

Of 30 Sensex stocks, Sun Pharma was the sole gainer after the world's fifth-biggest generic drug maker on Thursday reported a 90 per cent rise in net profit for the July-September quarter. The stock closed 3.30 per cent higher.

M&M was the top loser falling 6 percent, followed by Adani Ports (5.86 per cent), and ICICI Bank (5.32 percent) on the 30 stock Sensex.

The TCS stock on Friday hit a fresh 52-week low amid former Tata Sons chairman Cyrus Mistry and the Tatas levelling allegations against each other in the public. The stock made a new 52-week low of Rs 2091 level on the BSE after opening at Rs 2145 level and touching an intraday high of Rs 2146.It closed 2.54 percent lower on the BSE.

All nine BSE indexes based on market cap ended in the red. The BSE midcap index fell 3.62 percent or 467 points points to 12464 level.

Among BSE's sectoral indexes, BSE auto and consumer durables fell 976 and 581 points, respectively. The auto and consumer durables were hit, anticipating lower demand for goods in the near future due to the effects of demonetisation. All 19 indexes closed lower.

Sun Pharma was the sole gainer on Nifty 50.

The Nifty IT index fell 2.28 percent, heading for its biggest weekly fall since mid-February, on worries about what Trump's election would meant for the export-dependent sector.

HCL Technologies and Tech Mahindra fell 2.91 percent and 2.60 percent, respectively.

Global markets

On Wall Street, US S&P 500 Index rose 0.2 percent while the Dow Jones industrial average jumped 1.2 percent, smashing through its previous record high set in August by almost 1 percent.

In contrast, the technology-heavy Nasdaq fell 0.8 percent, with Apple dropping 2.8 percent.

However, the US dollar strengthened over bond yields that soared over market expectations that the newly elected president's policies might fuel inflation.

In Asia, Hong Kong's Hang Seng index lost 1.3 percent to 22,538.51 and South Korea's Kospi fell 0.7 percent to 1,989.12. Japan's benchmark Nikkei 225 added 0.2 percent to finish at 17,374.79 after touching a half-year high in early trading as the yen fell against the dollar. Australia's S&P/ASX 200 edged up 0.8 percent to 5,370.70. Shares in Taiwan dropped 2.1 percent and in Indonesia they fell 3 percent. The Shanghai Composite added 0.7 percent at 3,193.72.

(With agencies inputs)