Sensex plunges 589 points; Nifty settles below 13,700

Benchmark domestic stocks on Friday, January 29, 2021, declined more than one per cent. The Sensex and Nifty logged losses amid negative global cues. The BSE Sensex closed below 46,500 mark while the NSE Nifty settled below 13,700 level. The Sensex plunged 588.59 points, or 1.26 per cent, down at 46,285.77. The NSE Nifty also declined 182.95 points, or 1.32 per cent to trade at 13,634.60. However, Nifty Bank gained 207.20 points, or 0.68 per cent, to close at 20,565.50.

The broader market at BSE also fell but out-performed the Sensex. The BSE Mid-Cap index ended 0.69 per cent down and the BSE Small-Cap index slipped 0.25 per cent.

The market breadth was negative. On the BSE, 1400 shares rose and 1508 shares fell. On the Nifty 50 index, 7 shares advanced and 43 shares declined. The top five gainers on Nifty 50 index were IndusInd Bank (up 6.14 per cent), Sun Pharma (up 4.26 per cent), ICICI Bank (up 2.03 per cent), HDFC Bank (up 1.43 per cent) and HDFC Life (up 1.19 per cent). The top five losers were Dr Reddy's Laboratories (down 5.30 per cent), Maruti Suzuki (down 4.83 per cent), Hero MotoCorp (down 3.69 per cent), Tata Steel (down 3.33 per cent) and Bharti Airtel (down 3.27 per cent).

Economic Survey 2020-21

The Economic Survey 2020-21, tabled by Finance Minister Nirmala Sitharaman in the parliament on Friday estimates India's GDP to contract by 7.7 per cent in FY2020-21, composed of a sharp 15.7 per cent decline in first half and a modest 0.1 per cent fall in the second half. In 2021-22, a sharp recovery of real GDP growth of 10-12 per cent is expected based on a low base effect and inherent strengths of the economy.

The government of India may need to continue with an expansionary fiscal stance in order to sustain the recovery in aggregate demand, said the Economic Survey for 2020-21.

Japan's Industrial Output

Japan's industrial output extended declines in December as factories struggled with a hit to demand from expanded COVID-19 lockdown measures globally. Official data released on Friday showed factory output declined 1.6 per cent in December.

GDP of the US

On the data front, GDP in the US grew at a 4 per cent annualized pace in the fourth quarter. The annualized pace closed out a 2020 that saw GDP overall decline 3.5 per cent for the full year and by 2.5 per cent from the fourth quarter of 2019. The number of Americans applying for unemployment benefits fell but remained at a historically high 847,000 last week.