The week ended August 12 was a politically significant one for India with Venkaiah Naidu assuming charge as the 13th vice-president on August 11. Stock markets continued their free fall, with benchmark indices Sensex and Nifty losing more than 1 percent, reflecting persisting headwinds.

Naidu’s election as the vice-president marks a significant achievement for the ruling Bhartiya Janata Party (BJP), with all the top three constitutional posts — president, vice-president and prime minister — occupied by the BJP, a first in India’s independence. The BJP’s spirits were high, notwithstanding problems on other fronts for the BJP-led NDA government.

For investors, it was anything but cheerful, with the Sensex and the Nifty closing in the red for the fifth consecutive day on Friday. The BSE Sensex ended 317 points down at 31,213 while the NSE Nifty closing at 9,711, down 109 points, or 1.11 percent. The sharp fall on the stock markets was led by public sector bank stocks, followed by metals. The Nifty PSU Bank index plunged 4.85 percent while the Nifty Metal index dropped 3.37 percent.

Top Sensex losers were State Bank of India (SBI), Mahindra & Mahindra, Reliance Industries and Larsen & Toubro while stocks that dragged the Nifty were Vedanta, Hindalco and SBI.

SBI declared its June quarter (Q1) results on Friday and they were clearly disappointing. Standalone net profit plummeted 20 percent  YoY to Rs 2,006 crore from Rs 2,521 crore in the corresponding period last year. Net interest income rose 22 percent to Rs 17,606 crore from Rs 14,437 crore in the year-ago period.

News on the asset quality front was a dampener, with gross non-performing assets (NPAs) as a percentage of total advances rising sharply to 9.97 percent, or Rs 1,88,068 crore, while net NPAs stood at 5.97 percent, of June 2017. Fresh slippages stood at Rs 26,249 crore.

SBI shares closed 5.36 percent lower at Rs 280 on the BSE on Friday and was the top Sensex loser.

India’s foreign exchange reserves rose by 581 million to $393.44 billion as of August 4, 2017, according to the Reserve Bank of India’s weekly supplement.

The Economic Survey II made a rather bold assessment of India’s GDP growth rate for FY2018, saying that achieving the upper end of the estimate (6.75-7.5 percent) would be difficult in view of challenges such as farm loan waivers and disruptions arising out of transiting to the GST regime.

Yet another dampener was the factory output (IIP) data for June. India’s factory output contracted 0.1 percent when compared to June 2016 numbers, according to a government statement released on Friday evening. A research firm said that the dip will be short-lived and output will bounce back in the near future. “We expect this adjustment to be short-lived and production should normalize within the next 2-3 months. We believe IIP growth is near its trough but recovery will be prolonged rather than V-shaped,” Kotak Economic Research analysts said in a note.