Reversal would be seen only if the Nifty closes above any previous day’s high
The Indian market closed the holiday-shortened week with a loss of 2%, mainly on global growth concerns, and the absence of positive triggers from the domestic arena. A decline in industrial output for September and lower exports in October also weighed on the market. The focus now shifts to the Winter Session of Parliament, beginning on 21st November, which will see another stormy session with opposition to the key reforms that were initiated by the UPA government recently.
The BSE Sensex tumbled 374 points (2%) to settle at 18,309 and the Nifty closed the week at 5,574, down 112 points (1.97%). The decline indicates that the downtrend is continuing. However, a reversal would be seen only if the Nifty closes above any previous day’s high.
The market ended on a flat note on Monday on the decline in industrial production numbers for September and weak global cues. The short trading session on Tuesday to herald the Samvat Year 2069 saw the benchmarks remaining subdued on global concerns. Selling pressure in IT, metal, fast moving consumer goods and auto stocks pushed the indices lower on Thursday. On Friday, the market erased all its gains in late trade and settled around 1% down.
In the sectoral space, BSE Consumer Durables (up 1%) was the lone gainer. The top losers were BSE Auto and BSE Metal (down 3% each).
The Sensex gainers in the week were Bharti Airtel (up 9%) and Coal India (up 1%). The main losers on the index were Tata Motors (down 6%); Tata Steel, ITC, Hero MotoCorp (down 5% each) and Hindalco Industries (down 4%).
The top Nifty performers were Bharti Airtel (up 9%), Coal India and Axis Bank (up 1% each). Tata Motors (down 6%), Grasim Industries, UltraTech Cement, Tata Steel and Ambuja Cements (down 5% each) were the key losers.
India’s industrial production, as measured by the Index of Industrial Production (IIP), contracted by 0.4% in September due dismal show by the manufacturing sector and a decline in consumer as well as capital goods output. Meanwhile, the IIP for August this year was revised downward to 2.3% from earlier provisional estimates of 2.7% released last month.
Headline inflation declined marginally to 7.45% in October from 7.81% in the previous month, even though prices of food items like rice, wheat pulses and potato showed a rise giving virtually no respite to the common man battling price rise. India Inc is of the view that the decline in the rate of price rise should encourage the Reserve Bank of India to cut interest rate that will lead to uptick in industrial activity.
On the international front, initial jobless claims in the US rose to their highest in more than a year, as a handful of companies announced mass layoffs—a sign of tardy economic growth. Meanwhile, anti-austerity protests and a deepening recession continue to impact the 17-nation Eurozone.