Stocks
Sensex, Nifty to move sideways for a long time: Weekly closing report

Now that the election results are out, the market will move sideways with a positive bias

Throughout the week, the Indian markets have been on an upswing and the optimism has  been based on the expected victory of Bharatiya Janata Party (BJP) in the Lok Sabha polls. However, even the best of forecasts could not match the stupendous victory recorded by BJP on the 16th May, which sent the indices soaring.

The BSE 30-share Sensex closed the week that ended on 16th May, at 24,122 (up 1128 points or 4.90%), while the NSE’s 50-share Nifty closed at 7,203 (up 344 points or 5.02%) for the week. We had mentioned in the previous week that this reporting week will see the market rallying upto 16th May. On Monday, the Indian markets carried forward the positive momentum of the previous week, and shot up at the open and traded high for the entire trading session. Ahead of the result, of the exit polls, the market surged anticipating the BJP-led NDA to be able to gain a majority.  Nifty closed at 7,014 (up 155 points or 2.27%).

Last Friday, the government data showed that India's merchandise exports rose 5.26% to $25.63 billion in April 2014 over April 2013. Imports dropped 15% at $35.72 billion in April 2014 over April 2013. The trade deficit for April 2014 was estimated at $10.09 billion, which was sharply lower than the trade deficit of $17.67 billion during April 2013.

On Tuesday, it was the third day of major gain on the indices, following the exit polls that predicted the high possibility of Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) forming the next government at the Centre. Nifty closed at 7,109 (up 95 points or 1.35%).

Inflation based on the combined consumer price index for urban and rural India accelerated to 8.59% (provisional) in April 2014, from 8.31% (final) in March 2014, data released by the government after trading hours on Monday, 12 May 2014, showed. Another data released by the government after trading hours on Monday, 12 May 2014, showed that industrial production shrank for a second straight month in March 2014. Industrial production declined 0.5% in March 2014, compared with a contraction of 1.8% in February 2014. For the year ended 31 March 2014 (FY 2014), the industrial production registered a contraction of 0.1%. The fall in February's output was revised to 1.8% from 1.9% reported earlier.

On Wednesday, after a relentless rally, market finally paused for breath and there was some profit booking from the very start of trading. Stock indices struggled to stay in the green without any success and the downtrend was visible all through the session. We had said that the market will remain directionless until the election results are clear. Nifty closed flat at 7,109. Bank stocks were in focus as the committee appointed by the Reserve Bank of India (RBI) under Dr P J Nayak proposed that the government should cut its stakes in state banks to below 50% and establish "fully empowered" bank boards.

After a weak opening on Thursday the market managed to surge but soon gave up gains and closed marginally higher. Nifty closed at 7,123 (up 14 points or 0.20%). Government reported annual rate of inflation based on monthly wholesale price index (WPI) easing to 5.2% for the month of April 2014 from 5.7% in March 2014.

At the end of the session we had said that the indices may sell off temporarily if the NDA’s margin of victory was wafer-thin. But if the BJP  wins with a comfortable margin there would be no fear of a sell-off, even temporary.

On Friday, as the stupendous results of elections started trickling in even before the market opened, Sensex and Nifty opened with a huge upward gap. Sensex shot up to 25,376 before profit booking set in and Nifty went as high as 7,563 at 10. Thereafter, continuous selling started and Nifty went down all the way to a low of 7,131, almost to where it had closed yesterday. This was followed by a small revival but Nifty ended up only 80 points.

 

For the week, among the other indices on the NSE, the top two performers were Realty (14%) and PSU Bank (13%) while the worst performer was Pharma (4%).

 

Among the Nifty stocks, the top five stocks for the week were BHEL (19%); DLF (17%); Sesa Sterlite (17%); BPCL (14%) and Tata Power (13%) while the top five losers were Dr Reddy's Lab (11%); United Spirits (5%); Wipro (2%); Hindalco (2%) and Sun Pharma (2%).

 

Of the 1,447 companies on the NSE, 839 companies closed in the green, 566 companies closed in the red while 42 companies closed flat.

 

 

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COMMENTS

Suiketu Shah

3 years ago

Superb piece and very very useful.

Modi 'Tsunami' sweeps Congress-led UPA

When outgoing Prime Minister Manmohan Singh said, where is the Modi wave?, he may have wanted to say, the wave had become a Tsunami. No wonder, Sonia Gandhi-led Congress received its worst defeat in history from Narendra Modi and BJP


As expected by common people, the Narendra Modi-led Bharatiya Janata Party (BJP) has defeated Congress-led United Progressive Alliance (UPA) by a landslide margin. Contrary to media pundits predictions, the BJP even managed to cross the 272 figure, required for majority in the Lok Sabha, on its own. In fact, in several states, Sonia Gandhi-led Congress could not even win a single seat. Several top guns and stalwarts from Congress and UPA, like ministers Kapil Sibal, Sachin Pilot, Sushilkumar Shinde, Milind Deora, CP Joshi, Pawankumar Bansal, Farooq Abdullah, Praful Patel and corporate honcho-turned politician Nandan Nilekani lost their seats, many of them to BJP. Even Arvind Kejriwal, the founder of Aam Admi Party (AAP) and several of his bigwig party members like Kumar Vishwas, Ashutosh, Yogendra Yadav had to face the defeat.

 

ALL INDIA Result Status

 

 

Status Known For 539 out of 543 Constituencies

 

Party

Won

Leading

Total

Bharatiya Janata Party

13

265

278

Communist Party of India

1

0

1

Communist Party of India (Marxist)

0

10

10

Indian National Congress

1

41

42

Nationalist Congress Party

1

5

6

Aam Aadmi Party

0

4

4

All India Anna Dravida Munnetra Kazhagam

0

35

35

All India N.R. Congress

0

1

1

All India Trinamool Congress

0

34

34

All India United Democratic Front

0

3

3

Biju Janata Dal

0

20

20

Indian National Lok Dal

0

2

2

Indian Union Muslim League

0

2

2

Jammu & Kashmir Peoples Democratic Party

0

3

3

Janata Dal (Secular)

0

2

2

Janata Dal (United)

0

2

2

Jharkhand Mukti Morcha

0

1

1

Kerala Congress (M)

0

1

1

Lok Jan Shakti Party

0

6

6

Naga Peoples Front

0

2

2

National Peoples Party

0

1

1

Pattali Makkal Katchi

0

1

1

Rashtriya Janata Dal

0

4

4

Revolutionary Socialist Party

0

1

1

Samajwadi Party

0

7

7

Shiromani Akali Dal

1

3

4

Shivsena

1

18

19

Sikkim Democratic Front

0

1

1

Telangana Rashtra Samithi

0

11

11

Telugu Desam

0

14

14

All India Majlis-E-Ittehadul Muslimeen

0

1

1

Apna Dal

0

2

2

Rashtriya Lok Samta Party

0

3

3

Swabhimani Paksha

0

1

1

Yuvajana Sramika Rythu Congress Party

0

10

10

Independent

0

4

4

Total

18

521

539

Courtesy: Election Commission of India Last Updated at 2:57 PM On 16/5/2014

 

Ever since media came out with its exit polls for the Lok Sabha election 2014, several people, mostly politicians from Congress-led United Progressive Alliance (UPA) were saying that in last two elections, these surveys were proved wrong. Well, all the media and all the survey can't be wrong all the time. In fact, this time, the Narendra Modi'fied' campaign was so powerful that it not only proved exit poll results below estimate but completely swept Congress and its (UPA).

 

The Congress has accepted its defeat (what else can it do?). Although the BJP was saying that Congress would find it difficult to reach 100 seats, after the verdict, both must be wondering, how this could happen?

 

Full credit to BJP's clean victory goes to Narendra Modi and his non-stop campaign across the country. Even the Congress and its allies, by passing remarks and provoking Modi, helped the BJP to keep its prime ministerial candidate in the focus throughout the elections.

 

On the other hand, opposition parties, especially Congress appeared to be divided as to on whom to focus. So it brought Sonia and Rahul Gandhi during the first phase only to be replaced by Priyanka Gandhi Vadra. Unfortunately, none can match the already 'running in full steam' Modi and thus were found to be on the defensive all the time.

 

During last elections, Congress had won 206 seats in the 543-seat Lok Sabha and was the single largest party. On the other hand, BJP had only 116 seats.

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