We had mentioned in last week’s closing report that Sensex, Nifty were under pressure. The major indices of the Indian stock markets shrugged off the decline and handsome gains over the week. The weekly trends of the major indices are given in the table below:
The key Indian equity market indices that opened in the green on Monday were trading flat in the afternoon session. Good buying was observed in fast moving consumer goods (FMCG) and telecom sectors, while selling pressure was seen in realty and energy sectors. There was no fresh macro-economic stimulus and the market is in a wait and watch mood until there is clarity in interest rates from the US Federal Reserve. Trends in global crude oil prices, movement of the Indian rupee and further announcements on the monsoon were to influence investors' sentiments. On the domestic front, a key event to be watched was the results of some of the large companies in the capital goods sector. The expectation was negative, and it was likely to put additional pressure on the markets.
On Tuesday, the main indices traded in the green during the mid-afternoon session, as healthy buying was witnessed in automobile and fast moving consumer goods (FMCG) stocks. Initially, the key indices opened on a flat note, depressed by weak Asian markets, which were impacted by negative macro-economic data from Japan. The domestic markets soon receded on the back of risk-aversion on the renewed fears of a US rate hike in June. A hike is expected to lead FPIs (Foreign Portfolio Investors) away from emerging markets such as India. This had led to an outflow of foreign funds from the domestic equity markets on Monday. Besides, investors were seen reluctant to chase prices higher due to the upcoming F&O (futures and options) expiry and a weak rupee. The BSE market breadth was skewed in favour of the bears -- with 1,599 declines and 907 advances.
Positive global cues, including indications that US Fed may not hike interest rates led to a surge in the Indian equity markets on Wednesday. Buying was witnessed in banks, capital goods, automobile, information technology (IT) and oil and gas stocks. Initially on Wednesday, the key indices opened on a higher note, in-sync with their Asian peers, which rose on the back of positive macro-economic data from the US which showed signs of a healthy economic recovery. Besides, higher crude oil prices, positive European indices and a stable rupee restored investors' confidence. In addition, value buying at key levels and predictions of better-than-expected monsoon rains supported prices. Morgan Stanley also upgraded India to overweight from equal weight adding the positive sentiment for our market. There was been a worldwide stock market rally on Tuesday-Wednesday beginning with the US markets on Tuesday.
Positive global cues, along with fresh influx of foreign funds and a rise in global crude oil prices, lifted the global and Indian equity markets further on Thursday. Besides, healthy quarterly results and a strong rupee pushed both the key benchmark indices to their new highest monthly levels. The key indices made substantial gains during the mid-afternoon trade session as healthy buying was witnessed in capital goods, banks and automobile stocks. The BSE market breadth was tilted in favour of the bulls -- with 1,304 advances and 1,142 declines. In terms of broader markets, the midcap and smallcap indices gained more than half a percent each.
The Indian equity markets remained buoyant on Friday. The key indices made gains during the mid-afternoon trade session, as buying was witnessed in healthcare, oil and gas, and automobile stocks. The BSE market breadth was tilted in favour of the bulls -- with 1,391 advances and 1,049 declines. The key indices opened on a higher note, in-sync with their Asian peers and continued to head higher thanks to healthy quarterly results and an appreciation in rupee.