Starting the week with “Black Monday” on massive sell-off in global markets due to fears of an earlier-than-expected US interest rates hike, the S&P BSE Sensex and CNX Nifty continued to decline for most of the week.
Rising inflation also weighed on market sentiment on Friday as it dashed hopes of aggressive interest rate cuts by the Reserve Bank of India (RBI).
On Monday, after US Labour Department said unemployment fell to 5.5 per cent in February, the lowest level since May 2008, speculation was triggered that the US Fed will lift rates from near-zero as early as summer which hit the emerging markets, including India.
The rupee’s plunge to two-month lows too kept the market on a shaky ground. It had tumbled by 604.17 points, or 2.05 per cent, on Monday, registering biggest single day fall after January 6, 2015, when it had plunged by 854.86 points.
However, the market gained some ground on Thursday on positive developments like passage of Insurance Bill in Rajya Sabha, rise in Index of Industrial Production (IIP) and IMF report raising forecasts of India’s economic growth to 7.2 per cent in the current fiscal.
The benchmark S&P BSE Sensex resumed lower and remained in negative terrain throughout the week, moving between a wide range of over 870 points, before concluding the week at 2,8503.30, revealing a sharp fall of 945.65 points, or 3.21 per cent.
In last four weeks, it has risen by 731.04 points, or 2.55 per cent.
This is the biggest fall in current calender year, since second week of December 2014, when it had plummeted by 1,107.42 points, or 3.89 per cent.