Sensex weekly loss 3.2 pct on heavy selling

All-round selling pressure on fears of further hike in interest rates down the index.

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 massive 611.56 points.

Interest rate sensitive sectors banking,auto and realty stocks declined as investors fretted over the possibility of more interest rate hikes by the Reserve Bank of India (RBI) 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.

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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 a net Rs 7,983.20 crore in this month (till 28 January),as per data from the stock exchanges. Domestic funds have absorbed a part of the selling from foreign funds,with a 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 weekend’s close.

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

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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 as against 15.52 per cent previously.

To control surging inflation,the Reserve Bank of India (RBI) at its quarterly policy review January 25 raised 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 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.

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Reliance Industries’ (RIL) lost 7.30 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 pct and was the top loser from the Sensex pack.

Other losers were M&M (9.62 pct),HUL (8.45 pct),RCOM (8.08 pct),Sterlite (6.10 pct),HeroHonda (5.61 pct),Cipla (5.35 pct),Hindalco(4.84 pct),Jaiprakash Asso (4.63 pct),Icici bank (4.58 pct),Bajaj Auto (4.33 pct),Wipro (4.03 pct),Tata Power (3.69 pct),Tata Motor (3.58 pct) and Bharti Airtel (2.72 pct).

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

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