Indian equities retreated on Friday, with the Sensex and Nifty snapping a three-day winning streak that had been buoyed by hopes of U.S. Federal Reserve rate cuts and progress in trade talks between New Delhi and Washington.

The S&P BSE Sensex closed 387.73 points, or 0.47%, lower at 82,626.23, while the NSE Nifty 50 fell 96.55 points, or 0.38%, to settle at 25,327.05.

Top Movers

Financial stocks fell 0.6%, snapping a record 12-session winning streak, while IT shares eased 0.5% after three days of gains.

Adani group companies rose between 0.3% and 12.4% after market regulator Sebi dismissed two allegations levelled by U.S.-based short-seller Hindenburg Research against billionaire Gautam Adani and his firms.

Vodafone Idea gained 7.1% following reports that the government told the Supreme Court it was not opposed to the telecom operator’s plea on adjusted gross revenue dues.

Despite Friday’s reversal, both indices advanced 0.9% over the week. Broader markets outpaced the benchmarks, with small-cap stocks climbing 2.9% and midcaps up 1.5%.

Expert views

The Indian equity market witnessed profit booking after a sustained multi-session rally, driven by anticipation of the FED entering an easing cycle, said Vinod Nair, Head of Research at Geojit Investments, adding that positive developments in U.S.-India trade negotiations and improved global liquidity conditions continued to offer a cushion to investor sentiment. “Against the backdrop of strengthening domestic fundamentals and a weakening U.S. dollar, the environment appears conducive for a potential return of FIIs, following a prolonged phase of net outflows. Sectoral rotation was evident, with PSU banks, metals, and pharma stocks leading the gains, while IT, FMCG, and private banking stocks lagged,” said Nair.

In technical terms, he Nifty slipped on Friday after forming a hanging man pattern in the previous session, said Rupak De, Senior Technical Analyst at LKP Securities, adding that “while the short-term trend continues to favor the bulls, a mild pullback from the current level looks possible.”

“On the lower side, support is placed at 25,150, below which the trend may weaken. However, if the index manages to stay above 25,150, it could move towards 25,500. A decisive move above 25,500 may then open the road to 26,000,” said De.