Stocks
Nifty, Sensex headed higher – Weekly closing report

Nifty will remain bullish as long as it does not end the coming week below 8,200

 

The S&P BSE Sensex closed the week that ended on 16th January at 28,122 (up 664 points or 2.42%), while the NSE’s CNX Nifty ended at 8,514 (up 229 points or 2.77%).
From here, Nifty will remain bullish as long as it does not end the coming week below 8,200. Previous week we had mentioned that benchmarks currently directionless.
 
On Monday, the Nifty moved in a haphazard manner, but finally managed closing in the green for the third consecutive session. Nifty closed at 8,323 (up 39 points or 0.46%). Market sentiments were initially affected by the concern that Europe's stimulus plans may not solve the euro region's economic woes.
 
On Tuesday, although Nifty managed to move in the green for major part of the session,  towards the end of the session, it was pulled lower and closed near the day’s low at closed at 8,299 (down 24 points or 0.28%).
 
India's index of industrial production (IIP) increased at five-month high pace of 3.8% in November 2014, recovering from the sharpest pace in three-years at 4.2% recorded in October 2014. The annual rate of inflation based on the combined consumer price indices for urban and rural India rose to 5% in December 2014 from nine-year low of 4.4% in November 2014, while snapping consistent decline for last four sequential months.
 
On Wednesday, the loss on the Nifty continued. Nifty closed at 8,278 (down 22 points or 0.26%). Data showed inflation based on WPI stood at 0.11% in December 2014, as compared to zero in November 2014.
 
The World Bank had said that economic reform measures taken by the Indian government, after coming to power in May last year, may result in its catching up with China’s growth in the year 2016-17.
 
On Thursday, before market opening, a surprise rate cut from Reserve Bank of India (RBI) resulted in the benchmarks recording huge gains. Nifty closed at 8,494 (up 217 points or 2.62%). Data announced after market hours on Thursday showed trade deficit narrowed to 10-month low of $9.4 billion in December 2014, while nearly halving from $16.86 billion in November 2014.
 
After a volatile upmove the Indian benchmarks closed Friday, marginally higher. Nifty closed at 8,514 (up 20 points or 0.23%). 
 
The SBI Composite Index, an indicator for tracking India's manufacturing activity, slipped from 55.4 (high growth) in December 2014 to 51.5 (low growth) in January 2015.
 
Among the Nifty stocks, the top five stocks for the week were Ultratech Cement (12%); Hindustan Unilever (9%); ACC  (9%); IDFC (8%) and Bhel (7%) while the top five losers were Hindalco Industries (-11%); Sesa Sterlite (-7%); Cairn India (-5%); Tata Steel (-4%) and Bharti Airtel (-4%).
 
Of the 1,492 companies on the NSE, 811 companies closed in the green, 642 companies closed in the red while 39 companies closed flat.
 
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were:
 

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SEBI restrains NICL from raising funds under CIS
According to SEBI findings, the company had raised nearly Rs7 crore from thousands of investors
 
Cracking down on illicit realty investment activity, market regulator Securities and Exchange Board of India (SEBI) has barred NICL India Ltd from raising funds from the public and launching new schemes with immediate effect. Based on a preliminary probe, SEBI found that the Madhya Pradesh-based company was running a 'collective investment schemes (CIS)' related to purchase and development of land, without getting requisite certification.
 
According to SEBI findings, the company had raised nearly Rs7 crore from thousands of investors. In an order, the market regulator said that to safeguard investors’ interest and till the time final decision is taken in the case, it was "necessary" for it "to take urgent preventive action by way of an interim measure". The regulator has asked the company and its directors -- Phool Singh Choudhary, Harish Sharma and Abhishek Chauhan "not to collect any fresh money from investors under its existing schemes" and "not to launch any new schemes or plans or float any new companies to raise fresh moneys".
 
Additionally, the company and its directors have been directed not to dispose of any assets obtained from the funds collected, while the entities also cannot divert money raised from the public.
 
Further, the entities have been asked to "immediately submit the full inventory of the assets" obtained through money raised by NICL. It would also have to furnish, among others, details about the investors and amount mobilised and refunded.
 
SEBI had come across a news report in July 2013 in respect of fund mobilisation from general public by NICL. The news report also stated that another group company of NICL was issuing debentures to investors. It was alleged that the group companies were offering high commission to their agents.

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Nifty, Sensex upward move intact – Friday closing report

Nifty will head higher as long as it does not close below 8,405

 

In Thursday’s closing report, we had mentioned that the NSE’s CNX Nifty will head higher subject to dips caused by global sell-offs. The weak opening on Friday was followed by a volatile up move. The Indian benchmarks touched a higher high and closed in the green.
 
S&P BSE Sensex opened at 28,057 while Nifty opened at 8,504. Both Sensex and Nifty then fell sharply hitting the day’s low at the beginning of the session at 27,945 and 8,452, respectively.  However, both moved higher later in the day to the level of 28,176 and 8,531. Sensex closed at 28,122 (up 46 points or 0.17%) while Nifty closed at 8,514 (up 20 points or 0.23%). NSE recorded a volume of 95.43 crore shares. India VIX rose 6.90% to close at 17.2750.
 
Data announced after market hours Thursday showed that India's merchandise export declined 3.8% to $25.4 billion in December 2014 over same month last year. Meanwhile, merchandise imports also declined 4.8% to $ 34.83 billion in December 2014 over December 2013. Thus, the trade deficit narrowed to 10-month low of $ 9.4 billion in December 2014, while nearly halving from US$ 16.86 billion in November 2014.
The Ministry of Commerce & Industry today claimed that some Japanese companies are seriously contemplating their future investment plans in India amounting to about Rs75,000 crore over the next 2-3 years.
 
The SBI Composite Index, an indicator for tracking India's manufacturing activity, registered declining month-on-month momentum. The monthly index has slipped from 55.4 (high growth) in December 2014 to 51.5 (low growth) in January 2015. On a year-on-year basis however, the index inched up to 52.1 in January (signalling moderate growth) from 50.6 (low growth) in December 2014.
 
As per the practice of revising rates every fortnight, state fuel retailers were expected to announce a cut in petrol and diesel prices Thursday as global rates had fallen by about 4%. However, they skipped the revision. Petroleum Minister Dharmendra Pradhan said the state-owned firms will do what is "appropriate". In fact, the government on Friday raised the excise duty on petrol and diesel by Rs2 per litre.
 
Sun TV Network (11.32%) was the top gainer in ‘A’ group on the BSE following the exit of promoters from lossmaking SpiceJet. Its December 2014 shareholding pattern showed increase in FII holding from 16.84% (in September 2014 quarter) to 17.94%  while DII holding fell from 1.92% to 1.52% and retail shareholding fell from 6.24% to 5.54%.
Jet Airways (4.02%) was among the top three losers in ‘A’ group on the BSE. It recently clarified that that reports saying that Naresh Goyal (the airline’s promoter and chairman) has pledged 51% shares held by him in Jet Airways to Punjab National Bank is factually inaccurate and incorrect. Jet Airways stated that the undertaking given to PNB implies that the airline’s promoter and chairman will not dilute his equity, by way of a sale, below 51% at any time, and will continue to be the majority shareholder in the airline. It is thus, an undertaking of non-disposal of any further equity and not a matter of pledging of his shares.
 
Sun Pharma (2.88%) was the top gainer while Hindalco (2.40%) continued to be the top loser in the Sensex 30 pack.
 
US indices closed Thursday in the red. Americans unexpectedly filed applications for unemployment benefits last week, indicating companies let go of seasonal workers following the holidays. Jobless claims climbed by 19,000 to 316,000 in the week ended 10 January 2015, the most since early September, from a revised 297,000 in the prior period, a Labor Department report showed.
 
Except for Shanghai Composite (1.20%) all the other Asian indices closed in the red. Nikkei 225 (1.43%) was the top loser.
 
China's foreign direct investment (FDI) rose an annual 1.7% last year. China attracted a record $119.56 billion from foreign investors last year compared to $117.6 billion in 2013, the Ministry of Commerce said in a statement.
 
European indices were trading higher while US Futures were trading in the red. Switzerland's central bank yesterday, 15 January 2015, scrapped its policy of capping the Swiss franc at 1.20 to the euro. The Swiss National Bank has intervened in markets since September 2011.
 
The latest data showed that inflation in Germany weakened in December, confirming its preliminary estimates for the previous month.  The annual rate of inflation in Germany, measured according to common European Union standards, was 0.1% in December, while prices also rose 0.1% on the month, the Federal Statistics Office said, confirming its preliminary figures published earlier this month.
 
Swiss National Bank yesterday dumped its long-standing minimum exchange rate of 1.20 Swiss francs to the euro, as the cap on the franc appeared increasingly indefensible in the face of the weakening euro. This has created shockwaves across Europe and US causing higher volatility and currency losses.
 
 

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