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Bangalore: Indian shares fell 2.17 per cent on Friday on growing worries among investors about the impact of a recession in the US, with heavyweights Reliance Industries and ICICI Bank leading the market down.
The market posted its fifth weekly fall in the last six weeks as confidence was hit by fears that foreigners would withdraw funds from India if sharp losses increased risk aversion, removing a key driver of the market's surge to record highs.
"We seem to be completely dependent on what's happening elsewhere. India's growth story seems to be a thing of the past. Investors are behaving as if recession has come to India," said Arun Kejriwal, strategist at research firm KRIS.
The benchmark BSE 30-share index fell 385.61 points to 17,349.07, with 27 components falling.
Worries that the world's biggest economy may be deteriorating more rapidly than expected sent stocks from Sydney to London lower yesterday, and kept the dollar pinned at two-week lows versus a basket of currencies.
"The way the market is falling just on overseas cues gives you a very eerie feeling going forward. One thing that comes out of all this is very clear: worse is yet to come," Kejriwal said.
The main index fell 4.2 per cent over the week, and is more than 18 per cent below a record high of 21,206.77 hit on January 10.
"I expect the market to remain volatile for the next few weeks and will continue to show a negative trend," said R.K. Gupta, chief executive at Taurus Mutual Fund.
The broader NSE index fell 1.56 per cent to 5,110.75, to be down 3.6 per cent on the week.
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