Nifty ends below 5700, tanks 7.8% in two weeks; banks dip

Indian equities badly butchered for another day on Friday and breached key psychological levels led by heavy selling in rate sensitive, commodities and infrastructure related companies' shares. The Nifty settled down below the 5700-mark, which was a strong support, according experts. The level has been severely tested on more than three occasions, which according to experts, is weakening the core structure of the Nifty.

''Now, the next range would be somewhere in the range of 5,400 or 5,500 to 5,900," says K Anant Rao, Kurtosis Analytics & Advisors.

Rahul Mohindar of viratechindia.com too expects levels of 5,400-5,500 being tested over the next one-two months. "In the current series, maybe 5,600 would provide some support but keeping a bigger context in mind, I could probably expect levels of 5,400-5,500 being tested over the next one-two months."

The fall was ferocious in terms of price and more importantly volume. Mohindar feels this market is probably looking still a bit nervous. "When we look at the rate sensitives - real estate and banking, there is no sign of any immediate support coming in here," he said.

The 30-share BSE Sensex closed at 18,860.44, with loss of 322.38 points or 1.68% and the 50-share NSE Nifty tanked 97.35 points or 1.69% to settle at 5,654.55. Benchmarks shed 587.38 points and 179.1 points from intraday highs, respectively. Indices had showed strong recovery in afternoon trade but that fizzled out in last couple of hours due to shorts build up.

Vibhav Kapoor of IL&FS believes 5,400-5,500 is going to be the defining level between continuing bull market or a new bear market. According to him too, 5,400-5,500 should be a very good support and a good medium-term buy.