Benchmark indices on Friday went through a choppy session and finished in the red as investors continued to exercise caution over the Omicron variant.

The mood remains divided on how 2022 will unfold with some analysts forecasting moderate returns while others expecting stocks to go back to their record breaking ways despite the various headwinds.

The 30-share Sensex had a volatile: it opened in the green at 57567.11 and rose 308 points to the day’s high of 57623.69 on positive global cues. However, a sudden spike in the number of Covid-19 cases in cities such as Mumbai and New Delhi and apprehensions over a likely third wave hit sentiment.

The index soon fell to a day’s low of 56813.42 down 810 points from the highest point. It ended at 57124.31, a fall of 190.97 points or 0.33 per cent. Likewise, the Nifty finished 68.85 points lower at 17003.75.

At close, the Sensex has fallen more than 8 per cent from its record intra-day peak of 62245.43 on October 19.

Analysts said 2022 could see stocks running into more headwinds even as the possibilities of more coronavirus waves cannot be discounted, resulting in equities delivering moderate returns .

One of the key development are interest rate hikes by central banks and the withdrawal of easy money policy which could affect foreign fund inflows into emerging economies such as India.

“It is unlikely to be an extremely rewarding year as the markets will have to grapple with global interest rates hikes that could put pressure on prices, more particularly in the first half,’’ an analyst with a foreign brokerage said.

Deepak Jasani, head of retail research, HDFC Securities, said 2022 will see the start of a meaningful economic and financial transition.

“A transition not just to post-Covid reality, but also to more normal monetary policy, and to more moderate returns on financial markets. We could see another year of positive equity returns (though milder) coupled with a down year for bonds,’’ he said.

However, there could be a surprise element in the form of the Indian economy recording robust growth.