Markets dip 1 per cent on oil price concerns

Mumbai: Despite a strong growth in India’s GDP for the second quarter of this fiscal year, the equity markets slumped another 1 per cent on Friday as rise in global oil prices and concerns regarding higher fiscal deficit dented sentiments.

The uptick in domestic growth according to market participants has also lowered the possibility of any cut in interest rate by the Reserve Bank in its monetary policy meeting scheduled next week.

Additionally, the uncertainty regarding the outcome of the Gujarat assembly polls also weighed on sentiments with cautious investors trying to book profits at higher levels.

The Nifty fell 104.75 points or 1.02 per cent to close at 10,121.80 while the Sensex closed at 32,832.94, down 316.41 points or 0.95 per cent.

“In the near term, market may remain volatile given RBI policy next week and US Fed meet in the second week of December. With steady reform implementation and improved corporate earnings, India would continue to remain a preferred investment destination for foreign portfolio investors and domestic institutional investors despite its premium valuations compared to other emerging markets. However, we advise traders to avoid over leveraging and keep their positions hedged until the outcome of RBI policy,” said Jayant Manglik, president, retail sales, Religare Securities.

According to the provisional data, FPIs were net buyers of equities worth Rs 306.11 crore. The broader markets also remained weak with 1,696 stocks traded on the BSE closing the day lower as compared to 1,010 stocks that advanced.