If the Nifty stays above 5,820, it will try to head for 5,950. A fall below 5,820 could be disastrous for the bulls

The market settled lower for the fourth week in a row, this time on cautiousness ahead of the Union Budget and negative sentiments from the US. Key events to be watched next week would the Railway Budget (26^th February), Economic Survey (27^th February) and the Union Budget (28^th February).

The Sensex declined 151 points (0.78%) to settle at 19,317 and the Nifty closed the week at 5,850, a cut of 37 points (0.63%). The market is delicately poised in the Budget week. If the Nifty stays above 5,820, it will try to head for 5,950. A fall below 5,820 could be disastrous for the bulls.

The market settled in the positive on Monday on gains in capital intensive sectors and the broader markets. Across-the-board buying helped the benchmarks recover from their lows and close higher on Tuesday. The market managed to settle in the green on Wednesday as cautiousness prevailed ahead of the Union Budget.

The market closed down over 1.5% on Thursday on selling in heavyweights after the release of the January meeting of the US Federal Reserve, which suggested that the central bank might withdraw the bond buying initiative sooner than expected. The indices closed flat with a negative bias amid highly volatile trade on cautiousness ahead of the Union Budget and sluggish global cues.

BSE Realty (up 4%) and BSE IT (up 2%) were the top sectoral gainers in the week while BSE Metal (down 3%) and BSE Fast Moving Consumer Goods (down 2%) emerged as the top losers.

The major gainers on the Sensex were Wipro (up 4%), Sun Pharmaceutical Industries (up 3%), Reliance Industries, Infosys (up 2% each) and GAIL India (up 1%). Jindal Steel & Power (down 7%); Coal India (down 5%), Tata Power (down 4%), Tata Steel and ITC (down 3% each) were the key losers on the index.

The top performers on the Nifty were DLF (up 13%), Wipro (up 4%), ACC, HCL Technologies and Ambuja Cements (up 3% each). The main losers were JSPL (down 7%), Coal India (down 5%), Tata Motors, Siemens (down 4% each) and Tata Steel (down 3%).

President Pranab Mukherjee, addressing a joint sitting of Parliament on the first day of the Budget session, set the tone for an austere Budget 2013-14, saying that the past year had been financially difficult for the country, with the Indian economy experiencing slower growth.

Finance minister P Chidambaram, on his part, is reportedly planning to slash public spending by up to 10% from this year’s original target.

The Reserve Bank of India (RBI) on Friday announced the much-awaited guidelines for new bank licences, allowing corporates and public sector entities with sound credentials and a minimum track record of 10 years to foray into the banking business.

Close on the heels of ordering attachment of bank accounts, investments and all other assets of two Sahara group companies and their promoters, including group chief Subrata Roy, the Securities and Exchange Board of India (SEBI) on Friday cautioned the investors and general public against transacting with these companies and persons. On 13th February, SEBI passed two separate orders, together running into 160 pages, directing attachment of properties and freezing of accounts.

In international news, next week’s 1^st March deadline to circumvent automatic US spending cuts marks another fiscal showdown between President Barack Obama and Congressional Republicans. If Congress doesn’t act, federal spending will be reduced by $85 billion in the final seven months of this fiscal year and by $1.2 trillion over the next nine years.

Minutes of the January meeting of the Federal Reserve announced earlier this week ignited concerns that the policymakers could withdraw the bond buying programme and US central bank said that it would review the program in March.