All-round selling pressure on fears of further hike in interest rates, slowing corporate earnings and heavy capital outflows by foreign funds pulled down the BSE benchmark Sensex by 611.56 points.

Stocks of interest rate sensitive sectors like banking, auto and realty declined as investors fretted over the possibility of more interest rate hikes by the Reserve Bank of India to tame inflation.

Volatility was high during the week as traders rolled over positions in the derivatives segment from January 2011 series to February 2011 series. The near-month January 2011 contracts expired on Thursday.

The BSE Small and Mid-Cap indices underperformed the Sensex. The mood was bearish with the market logging declines in three out of four trading sessions. The market was closed on Wednesday on account of Republic Day.

Foreign funds have dumped shares worth Rs 7,983.20 crore his month (till 28 January), as per data from the stock exchanges. Domestic funds have absorbed a part of the selling from foreign funds, with an inflow of Rs 4,229.02 crore.

The BSE Sensex tumbled by 611.56 points or 3.22 per cent to end the week at 18,395.97 from its last week’s close.

The 50-unit S&P CNX Nifty fell by 184.35 points or 3.24 per cent to 5,512.15.

The BSE Mid-Cap index fell 4.08 per cent to 6,898.37 and the BSE Small-Cap index lost 4.47 per cent to 8,546.29.

The food price index rose to 15.57 per cent for the week ended January 15 against 15.52 per cent previously.

To control the surging inflation, RBI in its quarterly policy review on January 25 raised the repo rate by 25 basis points to 6.5 per cent and the reverse repo rate by 25 basis points to 5.5 per cent with immediate effect.

Among the major indices, the BSE-Realty fell by 8.62 per cent followed by the BSE-Healthcare by 5.26 per cent, the BSE-Auto by 5.02 per cent, the BSE-Metal 3.93 per cent, the BSE-Oil&Gas by 3.88 per cent, the BSE-CG by 3.24 per cent and the BSE-FMCG by 3.04 per cent and the Bankex by 2.93 per cent.

Reliance Industries lost 7.3 pct on concerns about slow ramp up in gas production from the KG-D6 field. India’s largest real estate developer DLF tumbled 11.59 per cent and was the top loser from the Sensex pack.

Other losers were M&M (9.62 per cent), HUL (8.45 per cent), RCom (8.08 per cent), Sterlite (6.1 per cent),Hero Honda (5.61 per cent),Cipla (5.35 per cent), Hindalco (4.84 per cent), Jaiprakash Associates (4.63 per cent), ICICI Bank (4.58 per cent),Bajaj Auto (4.33 per cent), Wipro (4.03 per cent), Tata Power (3.69 per cent), Tata Motors (3.58 per cent) and Bharti Airtel (2.72 per cent).

However, ONGC firmed up by 2.76 pct after the company discovered shale gas at the Barren Measure shale at Icchapur near Durgapur in West Bengal.

Total turnover on the BSE and NSE fell to Rs 13,753.69 crore and Rs 56,112.45 crore respectively.

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