Sensex, Nifty trapped in a zone: Friday closing report

Moneylife Digital Team 13 September 2013

Nifty is losing its momentum and a close below 5,805 will be the sign that a correction is about to start

After several days of rally, markets paused in the US yesterday and in Asia today. Back home, the indices too opened in the red ignoring better than expected July 2013 factory output data and the data showing deceleration of the rate of retail inflation for August 2013, which was released after market hours on Thursday. The Sensex opened at 19,745 and moved in a range of 19,899 to 19,676 before closing at 19,733 (down 49 points or 0.25%). The Nifty opened at 5,828 and hit intra-day high of 5,884. The index hit an intra-day low at 5,823 before closing at 5,851 (down 0.10 points). The National Stock Exchange (NSE) recorded a much lower volume of 67.01 crore shares.

The top five gainers among the other indices on the NSE are Realty (2.82%); Infra (1.90%); PSE (1.90%); PSU Bank (1.38%) and Nifty Midcap 50 (0.95%). The only five losers were IT (1.18%); FMCG (1.14%); Service (0.25%); MNC (0.24%) and Finance (0.01%).

Of the 50 stocks on the Nifty, 34 ended in the green. The top five gainers were BHEL (5.97%); DLF (5.13%); Axis Bank (4.21%); PNB (3.98%) and Reliance Infrastructure (3.77%). The top five losers were HCL Technologies (2.64%); UltraTech Cement (2.32%); ITC (1.87%); Tata Steel (1.72%) and ICICI Bank (1.65%).

The Prime Minister's Economic Advisory Council (PMEAC) today sharply trimmed India's GDP growth forecast to 5.3% for the year ending 31 March 2014 from earlier estimate of 6.4% and said that tight monetary policy by the RBI may be continued until stability in the rupee value is achieved.

India may it find it a "challenge" to stick to its fiscal deficit target of 4.8% of GDP in the fiscal year that ends next March, the PMEAC said in a report on Friday. It estimated that the net foreign direct investment (FDI) flows would likely be at $21.7 billion for the current fiscal year, down from an earlier estimate of $24 billion.

India's gold imports are likely to come down to $38 billion from $53.8 billion this fiscal despite some demand pick up during the forthcoming festival season, Prime Minister's key economic advisor C Rangarajan said. The PMEAC has projected gold and silver imports at $40 billion this fiscal as against $55.8 billion shipped in last fiscal.

The Reserve Bank of India on Thursday, 12 September 2013, announced the details of its committee constituted to examine the current monetary policy framework and recommend ways to revise and strengthen it to make it more transparent and predictable. The committee is expected to submit its report within three months, the RBI said.

Except for Jakarta Composite (up 0.43%), Nikkei 225 (up 0.12%), NZSE 50 (up 0.20%) all the other Asian indices ended in the negative. Shanghai Composite, top loser, fell 0.86%.

The number of Americans seeking unemployment benefits plummeted last week 31,000 to a seasonally adjusted 292,000. But the drop was mostly because of technical issues in two states that delayed the processing of applications. This has triggered speculation that the Federal Reserve would begin trimming its monetary stimulus at next week's meeting.

The US and Russia began talks on Thursday on Moscow's plan for Syria to surrender its chemical weapons as Damascus formally applied to join a global poison gas ban, but Secretary of State John Kerry held fast to the position that the US may still use military force if diplomacy fails. Separately, Syria's President Bashar al-Assad reportedly said that the US needs to give up "its policy of threats" and stop shipping arms to Syrian rebels before his government surrenders its chemical weapons.

Among US data out later on Friday are retail sales for August and consumer sentiment for September.

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