A short-term upmove will be possible if the Nifty manages to stay above last week’s low
The market closed with a loss of over 2% on week economic indicators and a selloff by foreign institutional investors since Tuesday. Unsupportive global cues also weighed on investor sentiments. The quarterly earnings season and the release of industrial output numbers for February 2013 will guide the market next week.
The Sensex closed the week with a loss of 386 points (2.05%) at 18,450 and the Nifty ended 129 points (2.28%) lower at 5,553. A short-term upmove will be possible if the Nifty manages to stay above last week’s low.
The market settled in the positive on Monday (the first trading of fiscal 2013-14) even as economic indicators released earlier that day lagged expectations. Gains in the second half of trade enabled the market close higher on Tuesday. Selling pressure in rate-sensitive sectors led the market lower on Wednesday.
The benchmarks settled near their lows on Thursday on all-round selling. Weak cues from Europe and a selloff by FIIs saw the Indian market closing in the red on Friday.
The top gainers in the sectoral space were BSE Healthcare (up 3%) and BSE Oil & Gas (up 1%), while BSE Fast Moving Consumer Goods and BSE Metal (down 3% each) were the key losers.
The top performers on the Sensex this week were Maruti Suzuki (up 10%), Dr Reddy’s Laboratories (up 8%), Sun Pharmaceutical Industries (up 5%), Wipro (up 4%) and Cipla (up 2%). The main laggards on the benchmark were Bharti Airtel, HDFC (down 7% each), ITC (down 6%), Bajaj Auto and Tata Motors (down 5% each).
The Nifty was led by Maruti Suzuki (up 10%), Dr Reddy’s (up 8%), Cairn India (up 6%), Sun Pharma (up 5%) and Ranbaxy Laboratories (up 3%). The top losers were NMDC (down 9%), Bharti Airtel, HDFC (down 7% each), ITC (down 6%) and Axis Bank (down 5%).
India’s manufacturing sector witnessed the slowest rate of expansion in 16 months in March due to power outages which hampered production activity and decline in new business orders. The HSBC India Manufacturing Purchasing Managers’ Index (PMI)—a measure of factory production—stood at 52 in March down from 54.2 in February.
Output of the eight core sector industries contracted by 2.5% in February, declining for the first time in 2012-13. The contraction was on account of a steep drop in natural gas output. The negative performance in the reporting month pulled down the cumulative growth in 11 months of 2012-13 ended February to 2.6% against 5.2% during the corresponding period in 2011-12.
Growth in the country’s services sector eased last month to its slowest since October 2011 on a slowdown in new orders. The HSBC services Purchasing Managers' Index fell to a 17-month low of 51.4 in March from 54.2 in February. Services make up nearly 60% of India's output.
In corporate news, Mukesh Ambani's Reliance Jio Infocomm (RJio) earlier this week signed a definitive agreement by paying Rs1,200 crore as a fee to Anil Ambani's Reliance Communications (RCom) for using its inter-city fibre optic network. As per the agreement, RJio would use RCom's multiple fibre pairs spread over 1.2 lakh km across the country for providing backbone to roll out its 4G services. RCom will, in turn, have reciprocal access to optic fibre infrastructure to be built by RJio in the future.
In international news, the US unemployment rate slipped to 7.6% in March, from 7.7% a month earlier, the Bureau of Labor Statistics reported on Friday. However, the economy added a measly 88,000 jobs in March, as per a separate tally included in the jobs report.
Italy's fiscal deficit narrowed in the last quarter of 2012 to 1.4% of gross domestic product, compared with 2.6% in the same period of 2011. The contraction in the fiscal deficit at the end of last year was due to a surge in revenues from tax hikes imposed by Mario Monti's outgoing government, and in particular from an unpopular housing tax.
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