If BJP loses, it will be an excuse for punters to sell, if not, there could be a short rally
The S&P BSE Sensex closed the week that ended on 6th February at 28,718 (down 465 points or 1.59%), while the NSE’s CNX Nifty ended at 8,661 (down 148 points or 1.68%). Previous week, we mentioned that Nifty may be trapped in a range of 8,600-8,900.
On Monday, the flat opening on the Nifty was followed by the index trading in the red for most of the session. Nifty closed at 8,797 (down 12 points or 0.13%). India fiscal deficit reached 100.2% of Budget Estimate in nine months ended December 2014 to Rs5.32 lakh crore.
In January, India’s manufacturing activities expanded at a three-month-low pace, as orders moderated. The HSBC PMI declined to 52.9 points in January, compared with 54.5 in December.
On Tuesday, the Reserve Bank of India (RBI) in its sixth bi-monthly monetary review announced reduction in the statutory liquidity ratio (SLR), while keeping other key rates unchanged. Nifty closed Tuesday at 8,757 (down 41 points or 0.46%).
Eight core industries comprise nearly 38% of the weight of items included in the Index of Industrial Production (IIP). The combined index of Eight Core Industries stands at 172.7 in December 2014, which was 2.4% higher compared to the index of December 2013. Its cumulative growth during April to December, 2014-15 was 4.4%.
Domestic oil marketing companies (OMCs) on Tuesday slashed petrol prices by Rs2.42 a litre and diesel price by Rs2.25 a litre in line with the decline in global oil prices.
Wednesday was the fourth consecutive session of Nifty closing lower. Nifty closed at 8,724 (down 33 points or 0.38%). The HSBC India Services PMI Business Activity Index edged up to 52.4 in January 2015, from 51.1 in December 2014. According to survey responses, the latest increase in the services activity reflected further growth of new business during the month.
Pessimism on the Nifty continued on Thursday. During the afternoon session, the 50-share index shot up for a while but met with severe selling in the last 45 minutes and hit a lower low before closing near the same level. Nifty closed at 8,712 (down 12 points or 0.14%).
The stance of European Central Bank (ECB) standoff between the Greek government and its international creditors by declaring it would stop accepting Greek bonds as collateral for central bank loans added to the negativism on the bourses. The market was also nervous ahead of Delhi elections, which seemed to be a close race between Bharatiya Janata Party (BJP) and Aam Admi Party (AAP).
RBI on Thursday allowed Foreign Portfolio Investors (FPIs) to invest their coupons received on investments in government securities back into such bonds. These investments would be allowed even after the FPIs having fully utilised the applicable limits of $ 30 billion.
On Friday, Nifty witnessed a volatile session in the red. Nifty closed at 8,661 (down 51 points or 0.58%). Ahead of US jobs report, which could provide cues on the US economic recovery, performance of the global counterparts looked mixed. Disappointing German industrial production data and concerns over Greece's future continued to affect market sentiments adversely.
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were: