Mumbai, Jan 23 (IANS) The Indian equity markets posted strong losses on Friday, flipping early gains amid continued selling by foreign institutional investors.

At the closing bell, the Sensex lost 769 points, or 0.94 per cent to settle at 81,537. The Nifty declined 241 points, or 0.95 per cent, to close at 25,048.

The broader markets posted stronger losses than the benchmark indices as Nifty Midcap 100 index lost 1.95 per cent, while the NSE Smallcap 100 declined 2.06 per cent.

Nifty 50 and Sensex began the final day of the trading week slightly up, tracking global cues as geopolitical tensions over Greenland eased.

But the indices dipped sharply due to strong foreign selling and mixed earnings reports leading to investors maintaining a cautious outlook.

On the sectoral front, all indices were in the red. Nifty Realty fell the most down 3.42 per cent. Nifty Media dropped 2.79 per cent while Nifty PSU Bank declined 2.43 per cent. Nifty Auto eased 1.25 per cent while Nifty Oil and Gas slipped 1.30 per cent.

Analysts said that Indian equity markets went on a sell-off mode despite an optimistic global market and supportive domestic PMI data. The sentiment was weighed down by an uptick in crude oil prices, a sharp depreciation of the rupee, FIIs selling and earnings delivery falling marginally short of expectations amid premium India valuations.

Looking ahead, market sentiment will likely remain cautious as investors keenly wait for the upcoming Union Budget and the US Fed’s interest rate decision, they added.

Market watchers predicted that if better-than-expected results for Q3 FY26 are reported for some companies, they could trigger only a stock-specific reaction because foreign institutional selling is expected to continue in the near term.

The rupee slumped 41 paise to touch 91.99 against the US dollar in intraday trade on Friday, amid persistent foreign fund outflows.

Analysts said that intervention from the central bank has kept the volatility in check to some extent, but could not reverse the overall negative trend for the domestic currency.

—IANS

aar/na