Benchmark indices saw consolidation and ended the passing week on a flat note after a 6 percent correction in the preceding two weeks, as the overall weak sentiment due to the PNB fraud case offset positive moves in global markets, wherein US indices rallied 4-5 percent and others gained over a percent.
However, mid and small-cap stocks underperformed frontline indices to end with a loss of 0.8 percent. On the sectoral front, the biggest loser was the PSU Bank index, which lost more than 8 percent after the bank fraud came to light.
Overall, the market is expected to consolidate further in the coming week also, though the sentiment could remain negative due to the big banking transaction fraud. Also, the expiry of February derivative contracts is expected to keep the market volatile and with earnings season out of the way, all eyes are now on global cues according to experts.
“The PNB scam has dampened the sentiment for banking sector and the overall markets in general, as the amount and exposure to various banks is still uncertain. Indian market may underperform in an otherwise strong global market till there is clarity on resolution of these recent developments,” Hemang Jani, Head – Advisory, Sharekhan