The benchmark Sensex crashed 536 points with financials leading the fall as investors were disappointed by the delay in the relief package even as apprehensions grew over the impact of Franklin Templeton Mutual Fund winding up six debt schemes. Fears of capital outflows also pushed the rupee down 40 paise to settle at 76.46 against the dollar.
The 30-share Sensex on Friday attempted to stage a rally as it hit an intra-day high of 31842.24 after opening at 31426.62 on hopes that the Centre would announce the fiscal package in a day or two.
However, with no clear indications coming from the government and worries about the Franklin Templeton decision saw some frantic sales. The index closed 1.68 per cent down at 31327.22.
Stocks were also weighed down by disappointing data from the US and negative global cues. The NSE Nifty declined 159.50 points, or 1.71 per cent, to 9154.40.
Weak equities and a strengthening greenback also weighed on the rupee. Forex traders said market sentiment weakened after a potential antiviral drug for coronavirus reportedly failed its first trial.
The rupee opened lower at 76.30 and then fell further to 76.47 before closing at 76.46, down 40 paise over its last close. The rupee had settled at 76.06 on Thursday.
“The markets are trading uncertain with the virus updates not giving any solace. Investors are looking forward to stimulus measures from the government. The week ahead will also be driven by stock specific news regarding the business outlook of individual companies. Any easing of lockdown restrictions will be a positive,’’ said Vinod Nair of Geojit Financial Services.
However, the Reliance scrip continued to gain after the Facebook deal was announced. Since the announcement, shares of RIL have climbed almost 15 per cent.
On Friday, it settled with gains of 3.34 per cent at Rs 1,417.35. While observers say that the stock is being re-rated, several brokerages have buy ratings on the counter.
“This, along with the closure of a Rs 7000-crore sale to BP in the oil marketing JV, should imply cash infusion of over Rs 50,000 crore which will bring down net debt by 20 per cent possibly by the end of this quarter,” analysts at CLSA said in a note.
Building these inflows will pull down net debt/Ebitda from 2.7 times in March 2020 to comfortable levels of 2.1/1.3 times in March 2021/March 2022. The progress in stake sale in tower and fibre InvIT as well as to Aramco may be the other triggers’’, analysts at CLSA said in a note. The brokerage has a target price of Rs 1500 on the stock.