Friday’s big fall on Dalal Street was led by consumer durables and rate-sensitive sectors — banking and realty — and even defensive sectors such as pharma, IT and FMCG were not spared.
The BSE Consumer Durable index tanked 8.4 per cent, twice as much as the Sensex (four per cent decline).
The plunge was led by Titan Industries’ 12 per cent fall.
The jewellery major gave up a chunk of its recent gains following the RBI’s moves on Wednesday again stipulating upfront payments for gold purchases by importers, in a rollback of its earlier concessions.
Other sectors that figured prominently in the losers’ list include BSE Realty, BSE Bankex, BSE Metal, BSE Capital Goods and BSE Oil and Gas, their losses ranging between four per cent and six per cent.
Bumpy ride
Cost pressures, liquidity crises and execution risks have weighed on the capital goods stocks, leading to over 22 per cent decline in the BSE Capital Goods Index in the last one month.
Continued weakness in the rupee has increased the subsidy burden for downstream oil companies, causing the Index to topple by over 8.5 per cent during the same period. For metal stocks, the weakness in global commodity prices and domestic demand has been a dampener in the last one month.
It has been a bumpy ride for banking stocks too.
Defensives, not safe
SBI’s results this week underlined concerns about deteriorating asset quality and the recent measures by the RBI to tighten liquidity have further added to the credit squeeze on India Inc.
This led to an almost 16 per cent fall in BSE Bankex in just a month.
FMCG, perceived as a safe bet in a volatile market, also joined the losers’ bandwagon, falling 3.8 per cent on Friday.
Slowing volume growth and stiff valuations have possibly led investors to take some profits off the table.
The BSE FMCG Index has shed almost 9.6 per cent since July 16.
Pharma and IT, believed to be the big beneficiaries of a weak rupee, were not spared either.
Profit-booking by investors may have added to the pressure on the stocks in this space. BSE IT Index lost 2.3 per cent in Friday’s trade even as BSE Healthcare Index (1.4 per cent decline) fell the least.
Concerns over price control for drugs in the domestic market led to the 4.2-per-cent slide in the one month return for the BSE Healthcare Index.
BSE IT has been the best performer among the sector indices in the last one month, gaining 9.3 per cent, clearly showing the market preference for sectors set to benefit from a strong dollar.