Nifty will have to close above 8,700, as a first step for the downtrend to reverse
The S&P BSE Sensex closed the week that ended on 17th April at 28,442 (down 437 points or 1.51%), while the NSE’s CNX Nifty closed at 8,606 (down 174 points or 1.99%). In the previous week, we had mentioned that the upmove on the Nifty may continue. However a weekly close below 8,600 maybe a signal temporary reversal.
On Monday, Nifty closed higher for the seventh consecutive session. Nifty closed at 8,834 (up 54 points or 0.61%). Prime minister, who inaugurated the Hannover Fair in which India is a partner country, said that India aims at a stable and transparent tax regime and that development is "not a mere political agenda" but an "article of faith" and sought international support to achieve the objectives crucial for growth.
Government has shortlisted about a dozen state-run units including IOC, National Fertilisers, MMTC, Hindustan Copper and ITDC for stake sale to achieve the current fiscal's disinvestment target of Rs41,000 crore.
The stock market was closed Tuesday for Dr Babasaheb Ambedkar Jayanti. On Wednesday, Nifty upmove was arrested and it closed at 8,750 (down 84 points or 0.95%). All-India general CPI inflation slowed down to three-month low of 5.2% in March 2015 (new base 2012=100) from 5.4% in February 2015.
The World Bank and the International Monetary Fund (IMF) said that there is a need for India to push forward the reforms agenda. IMF said in its bi-annual World Economic Outlook, released in Washington DC that India's growth at 7.5% in 2015-16 will surpass China's decelerating growth of 6.8% in the same year.
The loss on the Nifty continued on Thursday as well. Nifty closed at 8,707 (down 44 points or 0.50%). India has the potential to make 9%-10% growth rate "a new normal", Finance Minister Arun Jaitley said, while asserting that high growth was essential to meet the challenges posed by the country's burgeoning young population.
The market remained weak on Friday too. The loss of past three sessions (including Friday) wiped off almost the entire gain earned in the period of 6 April 2015 to 13 April 2015 (six days). Nifty closed at 8,606 (down 101 points or 1.16%). Indian economy is expected to grow marginally higher at 7.3% during the year compared with 7.2% in 2014 and interest rate cuts will support private sector spending, said a group company of global rating agency Moody's.
Among the top two losers, in the Sensex 30 pack, was TCS which fell for the fifth consecutive session today. On Thursday after market hours it posted it March 2015 quarter results, which showed its operating profit falling by 37%, mainly attributed to the charge of one-time bonus of Rs2,627.91 crore given to eligible employees.
We broke the news on Thursday that three of its directors of Helios and Matheson were arrested by Economic Offences Wing in Chennai, as it failed to repay deposit and interest to several depositors. On Friday, the stock fell 5.54% to close at Rs58.85 on the BSE.
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were: