The local market witnessed a lacklustre performance in the week ended 10th December on the back of a huge sell-off in the broader markets. However, the announcement of better industrial output numbers for October, on the last trading day of the week, provided some relief and helped the indices pare some of their losses.
Investors will keep a watch until the Sensex crosses the 20,000-mark to make any big moves. The wholesale price index based inflation for the month of November will be announced early next week, providing some direction to the market on that particular day.
The market opened the week flat, as the indices after having crossed their crucial levels in noon trade, could not sustain the gains. A sell-off in select blue-chip stocks kept the market under pressure on Tuesday, forcing a close with a marginal loss in a generally choppy session.
A sell-off in the broader markets on Wednesday, after a news report that intelligence agencies are looking at price-rigging in select stocks, pulled the indices lower at the end of the session. The broader markets were thrashed for a fifth successive day on Thursday on offloading by institutional investors. The losses widened in the post-noon session, sending the indices further southwards. But on Friday, the domestic market made a good comeback, recovering over half the losses it had suffered in the previous trading session. Gains by select blue-chips and stocks in the broader markets supported the rally.
The market ended the week with a loss of 2% with the Sensex declining 458.04 points and the Nifty falling by 135.45 points.
The top Sensex gainers during the week included Wipro (up 5%), NTPC (up 4%), BHEL (up 3%), Jindal Steel & Power and Reliance Industries (up 2% each). The major losers were State Bank of India (down 11%), Reliance Communications (down 10%), DLF (down 8%), HDFC Bank and Reliance Infrastructure (down 7% each)..
BSE Oil & Gas (up 1%) was the only notable gainer in the sectoral space while the BSE IT index ended flat. BSE Bankex (down 8%) and BSE Realty (down 7%) were the top sectoral losers during the week.
India's industrial output soared by 10.8% in October. Robust demand for automobiles, electronic goods and power equipment spurred the growth in factory output, which encouraged finance minister Pranab Mukherjee to exude optimism that industrial output growth would be in the double-digits on an annual basis as well.
The Index of Industrial Production (IIP) had registered a slowdown in the previous two months and was at a sluggish 4.4% in September 2010, after surging by 15% in July.
Food inflation rose again, albeit marginally, to 8.69% for the week ended 27th November from 8.60% in the previous week, which was the lowest since May last year. The upward trend in food inflation also marked a break of seven consecutive weeks of a fall in food prices.
After four consecutive record-setting months, vehicle sales in the country slowed down in November, growing by 17.81% as against 45.93% growth registered in October on a year-on-year basis.
According to Society of Indian Automobile Manufacturers (SIAM), the total number of vehicles sold in the country stood at 12,21,981 units in November this year as against 10,37,232 units in the corresponding month last year. The industry body expects lower sales in December from that in November.
State-owned oil companies are likely to raise petrol prices by Rs1.50-Rs2 per litre early next week, while a Rs2 per litre hike in diesel rates is under government consideration, according to a senior government official. A hike in diesel prices looks imminent as crude oil prices have inched closer to $90 per barrel, widening the gap between domestic retail rates and the import cost.
India's exports in November rose by 26.8% to $18.9 billion year-on-year. Imports also grew by 11.2% in November to $27.8 billion. The trade balance in the month was $8.9 billion. The increase in exports prompted the government to exude confidence that outbound shipments will touch $215 billion this fiscal.
India's foreign exchange reserves grew by $2.41 billion during the week ended 3rd December to $296.40 billion after two consecutive weeks of decline, the latest Reserve Bank of India (RBI) data showed. In contrast, the country's forex reserves stood at $293.98 billion at the end of the previous week. Foreign currency assets, a major component of India's forex kitty, rose by $1.98 billion to $267.23 billion during the week ended 3rd December.
In international news, China's inflation accelerated at the fastest pace in 28 months in November, beating analysts' forecasts. Consumer prices rose 5.1% from a year earlier, driven by food costs, a statistics bureau report showed on Saturday. In October, inflation was 4.4%. Meanwhile, on Friday, the People's Bank of China-the country's central bank-hiked the Reserve Requirement Ratio by 50 basis points. The revision will come into effect from 20th December.
Everybody has all but assumed that SEBI chief CB Bhave is not getting an extension. Will they be surprised?
Two agencies are quarrelling over whose job it is to fix the problem even as India boasts of being an IT powerhouse
On 3rd December, the Indian media called it a "major embarrassment" that the Central Bureau of Investigation (CBI) website has been hacked by "Pakistani Cyber Army". What could be a bigger embarrassment than the fact that the website is still down and inaccessible nearly 10 days later? In a message on the CBI home page, the "Pakistani" hackers had warned the 'Indian cyber Army" not to attack their websites… well, they needn't have worried. Sources in the know say that the premier investigation agency can do nothing about the embarrassing situation because the National Informatics Centre (NIC) which hosts all government websites and CERT - the bombastically titled Computer Emergency Response Team, are quarreling about whose responsibility it is to set things right.
The government also called some cyber security experts including NASSCOM, but until the turf battles between government agencies are sorted out there is nothing that outside experts can do. "Don't be surprised if the website remains down for another month, if nobody intervenes to resolve the turf war", says one expert sarcastically. This is an outrageous state of affairs in a country that dreams of being an economic superpower and boasts of IT prowess.
Surely someone in the government, such as Minister for Information Technology ought to be held accountable. However, with former minister A Raja making headlines for corruption and the new minister Kapil Sibal fire-fighting to save government's face in the telecom scam, the CBI website is a minor embarrassment that nobody has the time to deal with. But this sort of callousness is alarming in a country that is steadily pushing all citizens to post their Tax information and biometrics online.
It is all very well for the government to appoint IT honcho Nandan Nilekani to head the Unique Identification Authority of India (UIDAI) but there is no will to ensure security. PTI had reported on 3rd December that, "Intelligence agencies have been often warning the government that proper cyber security was not being ensured in government offices and that no security audit was being carried out". It also reported the Pakistani hackers referring to "the filtering controls provided by the National Informatics Centre (NIC), a body which mans computer servers across the country.
Vickram Crisna, an IT expert says, "It is astonishing that bureaucrats will quarrel over turf when the country's reputation is at stake, and that even for a relatively trivial or non-critical (bannerware) showcase site. No wait, that's the normal response". The question is, if this is the situation with CBI website, what will happens to the rest of us, especially after Mr Nilekani "finishes" his UID job and moves on?
In connection with the security of other databases, including the UID project, Crisna says, "The point about UID is, if this is typically how government machinery works today, it is not surprising at all that beneficial services sought to be provided by the government either leak copiously or utterly fail to achieve their objectives due to systemic design faults that never get corrected or even seriously reviewed. And certainly do not invite public participation to resolve. Perhaps if this were tried, and inefficiency was properly accounted and corrected via suitably designed feedback channels, such instances would be minimized".
The biggest irony is that if you search the internet, there will be endless seminars, workshops and presentations by the very same organizations preaching multi-stakeholder coordination and capacity building on an international level to ensure cyber security. But on the group, national interest will always be compromised in the in-fighting and ego battles between government agencies.