Weekly Market Report: Will the Nifty, Sensex fight back before the Budget?

Moneylife Digital Team 16 February 2013

The Nifty will have to close above 5,920 in the next two days for a short upmove to start

Underperformance by the broader indices, mainly on lacklustre earnings from corporates, led the market marginally lower on a weekly basis. Disappointing industrial output data overshadowed the easing in the headline inflation. Investors are likely to play “wait-and-watch” ahead of the Union Budget on 28th February.

The Sensex closed the week down 17 points (-0.09%) at 19,468 and the Nifty fell 16 points (-0.27%) to 5,887. The Nifty will have to close above 5,920 in the next two days for a short upmove to start.

The market fell on Monday on lack of cues from Asia and on concerns about the nation’s economic growth. The Sensex snapped its eight-day losing streak to end higher on Tuesday despite lacklustre industrial output numbers for December.

Although the market was in the positive throughout the trading session on Wednesday, the benchmarks pared their gains in late trade to end marginally in the positive, on nervousness ahead of the release of the headline inflation data for January. Selling in heavyweights led the market lower on Thursday. The benchmarks settled lower on Friday on weak corporate earning and unsupportive global cues.

In the sectoral space, BSE PSU and BSE Healthcare ended flat while BSE Realty (down 5%) and BSE Capital Goods (down 4%) were the top losers.

Tata Motors, Sun Pharmaceutical Industries (up 6% each), HDFC Bank (up 4%), Coal India and ONGC (up 3% each) were the top Sensex gainers. The key losers were Maruti Suzuki (down 7%), Jindal Power & Steel (down 6%), Larsen & Toubro (down 4%), Bajaj Auto and Wipro (down 3% each).

The majors on the Nifty were Tata Motors (up 7%), Sun Pharma (up 5%), HDFC Bank, HCL Technologies (up 4% each) and Coal India (up 3%). Siemens (down 8%), DLF, Maruti Suzuki, JSPL (down 7% each) and BPCL (down 5%) were the main losers on the benchmark in the week.

The MCX Stock Exchange (MCX-SX) benchmark index SX40 went live with its equity trading platform on both the equities and equity derivatives on Monday. MCX-SX became India’s third full-fledged equity bourse after the BSE and the NSE.

Reserve Bank of India (RBI) governor Duvvuri Subbarao on Monday cautioned the country was headed for the highest ever current account deficit this fiscal, after it rose to 5.3% of GDP in the second quarter.

India’s retail inflation rose to 10.79% in January, on higher prices of vegetables, edible oil, cereals and protein-based items. On the other hand, Wholesale Price Index (WPI) based inflation fell to 6.62% in January, declining for the fourth month in a row, despite rise in prices of food items like vegetables, onions and rice.

Industrial output, as measured by the Index of Industrial Production (IIP) contracted to a three-month low of 0.6% in December on account of the poor performance of manufacturing and mining sectors and a slowdown in production of capital as well as consumer goods.

The Securities and Exchange Board of India (SEBI) on Wednesday ordered the attachment of all assets of two Sahara group firms —Sahara Housing Investment Corp and Sahara India Real Estate Corporation —besides freezing their bank accounts and those of their promoters and directors including that of group head Subrata Roy.

In international news, leaders Group of 20 nations on Saturday announced there would be no “currency war” and postponed plans to set new debt-cutting targets in an indication of concern about the fragile state of the world economy.

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