Stock markets decline in early trade dragged by foreign fund outflows

Mumbai: Benchmark indices Sensex and Nifty fell in early trade on Friday as relentless foreign fund outflows and selling in blue-chip bank stocks dragged the markets lower.

The 30-share BSE Sensex declined 299.17 points to 80,684.14 in opening trade. The 50-share NSE Nifty dropped 76.75 points to 24,759.55.

From the Sensex firms, Mahindra & Mahindra, Bajaj Finserv, UltraTech Cement, HDFC Bank, Bajaj Finance, Trent, ICICI Bank and Maruti were among the major laggards.

However, Tata Steel, Axis Bank, Tata Motors and Bharat Electronics were among the gainers.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,605.20 crore on Wednesday, while Domestic Institutional Investors (DIIs) bought stocks worth Rs 2,916.14 crore, according to exchange data.

"The positive impact of the central bank's bold initiatives to boost credit growth in the economy has the potential to sustain the momentum in the market, particularly in Bank Nifty. But this momentum is unlikely to sustain in the context of persistent FII selling in the market.

"FIIs are likely to further accelerate selling since the market construct provides them the opportunity to sell aggressively. The huge short position in the market indicates that the bulls will be on the defensive," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd, said.

In Asian markets, South Korea's Kospi and Japan's Nikkei 225 index were trading sharply higher, while Hong Kong's Hang Seng index quoted lower.

US markets ended higher on Thursday.

Global oil benchmark Brent crude climbed 0.59 per cent to USD 64.49 a barrel.

Equity markets were closed on Thursday for Mahatma Gandhi Jayanti and Dussehra.

On Wednesday, the Sensex jumped 715.69 points or 0.89 per cent to settle at 80,983.31, and the Nifty climbed 225.20 points or 0.92 per cent to 24,836.30. PTI SUM DRR