The 30-benchmark Sensex lost 260 points and closed at 30,673 while Nifty was down 67 points to 9,039.
It has been the third straight weekly loss triggered by the weak financial stocks.
Stocks including HDFC, ICICI Bank, Axis Bank pulled down the index. The RBI's step to slash the repo rate by 40 bps to 4 per cent didn’t bring any confidence in the market while the US-China tensions also fuelled the losses on Friday. While, IT majors, Infosys and TCS remained the top gainers.
Around 11:06 am, the BSE Sensex was at 30,525.54, down 407.36 points or 1.32 per cent, while the 50-share index Nifty was at 8,982.45, down 123.80 points or 1.36 per cent. Stocks including Bankex, Auto, Realty were down 1-3 per cent.
The RBI’s extension of three months of moratorium period failed to enthuse investors. Most banks and financial stocks took a hit after the announcement because it didn’t include any measures related to the restructuring of loans besides any support to banks.
Although the extension of the moratorium has come as a relief for the economy but in the long run will impact banks and NBFCs profusely.
Even global markets also remained weak on Friday as China takes up to implement a controversial security law for Hong Kong after witnessing the pro-democracy unrest last year. This also puts a further strain on the US-China ties which seem to be faltering in the wake of Covid-19. Apart from that China’s annual growth target has been reduced which also brought to the fore impact of the Covid-19 situation on the economy.
The Asian shares didn’t perform with Hong Kong's Hang Seng index sliding more than 5 per cent to a seven-week low, MSCI's broadest index of Asia-Pacific shares outside Japan was also down 2.7 per cent. Japan's Nikkei fell 0.8 per cent.
Meanwhile, the US stock futures was down around 1 per cent hinting at a weak opening of the Wall Street indices.
European shares, too, opened broadly lower.
In commodities, oil prices fell over 5 per cent towards $34 a barrel as the United States and China relationship remains under stress along with the concerns of over the demand recovery from the Covid-19 crisis.
(With inputs from agency)