Weekly Review

24 Jan 2010
As per the bull market is concerned, on a broader view,Nifty may retrace upto 4824 or 4661 levels.These levels can be considered as bounceback points.At these levels also the bull run is intact as we are betting on 5800 levels for the 2010
Weekly Review :
Indian benchmark indices tumbled over 4% during the week for the first time this year on aggressive selling by foreign insitutional investors (FIIs) and due to China`s monetary tightening and US banks regulations. China`s central bank had declared a 50 basis points hike in banks` reserve requirement ratio (RRR) on Monday and President Barack Obama proposed new limits on the size and trading practices of big US banks on Thursday.
Unfavourable external environment (China and US) had an adverse impact on sentiment, though the NSE Nifty did manage to rebound after falling well below 5000. The market remains vulnerable to a fresh decline, owing to both local as well as global factors. However, a further recovery from here on is not ruled out, especially if the RBI doesn't spring a nasty surprise in its quarterly policy meeting on Jan. 29. The undertone will also hinge on global markets remaining stable. Any fresh bad news from China or any other part of the world may drag the Nifty down below 5000 again. A flood of earnings announcements, including some top companies, will only add to the anxiety levels. Volatility may escalate due to the F&O expiry on January 28. Technically, the Nifty has strong support at 5000, but can drop as low as 4950. On the way up, the Nifty could encounter resistance at around 5120. So, brace for a bumpy ride. Don't take undue risks till the current uncertainty subsides and there is more clarity on direction.
Another factor which weighed on the sentiment was soaring food prices continued to fall for the third consecutive week. Food inflation eased to 16.81% for the week ended Jan. 9, 2010 as against 17.28% in the previous week. Index for primary articles increased marginally to 13.93% as against 13.82% for the week ago.
The 30 share index, Sensex lost 694.62 points, or 3.96%, to 16,859.68 for the week ended Jan. 22, 2010. On the other hand, the broad based NSE Nifty plunged 216.2 points, or 4.12%, to 5,036 in the same period.
Mid-cap stocks dropped 266.75 points, or 3.78%, to 6,783.66 in the week. While small-cap shares lost 309.29 points, or 3.45%, to 8,661.17 during the week.
All the BSE sectoral indices settled in the red. The BSE Realty Index was down 8%, as DLF fell 8.5% and Unitech lost 10.4% followed by Capital Goods, which fell 6.51%, Oil & Gas lost 6.06%, HC declined 5.99%, and Power went down 4.53% among major losers in the sectoral indices over the week.
Leaders in 30-share index were Maruti Suzuki India (1.64%), Bharti Airtel (1.31%), Hero Honda Motors (1.18%), Hindustan Unilever (0.59%), and Bharat Heavy Electricals (0.04%) over the week.
On the other hand Larsen & Toubro (10.83%), Jaiprakash Associates (10.64%), D L F (8.45%), Grasim Industries (8.34%), and Tata Power Company (8.27%) were the major losers in the Sensex over the week.
Maruti Q3 Results :
The company's Q3 net sales were up 62% at Rs 7,372.6 crore versus Rs 4,537.1 crore, year-on-year (YoY). Its net profit was up 222% at Rs 687.5 crore versus Rs 213.5 crore, YoY.Plans Rs.1700 cr capex for Manesar plant.
Results Next Week:
Adani Power, Alstom Projects, Alok Industries, Aban Offshore, Anant Raj Industries, Apollo Tyres, Aurobindo Pharma, BEL, BPCL, BoB, BoI, Britannia, Cairn India, Colgate, Cadila Healthcare, Canara Bank, Cipla, Century Textiles, Crompton Greaves, Cox & Kings, Dabur India, Dredging Corp., DLF, Educomp, EIH, Emami, EMCO, Gammon India, Gujarat Industries Power, Glenmark, GSK Consumer, Godrej Industries, GMR Infra, GTL Infra, GVK Power, HCL Tech, Hero Honda, Hindustan Unilever, Hindalco, HPCL, Hotel Leela, IOB, IVRCL Infra, IOC, IDFC, India Cements, Indian Hotels, Jagran, Jain Irrigation, Jindal Steel, Jet Airways, Jyoti Structures, KEC Intnl, KSK Energy, Karnataka Bank, Karur Vysya Bank, Lupin, LIC Housing, Max India, MTNL, M&M, Marico, Mundra Port, NHPC, NTPC, NALCO, Nagarjuna Construction, OBC, Opto Circuits, Onmobile, Pidilite, Pfizer, P&G Health, PNB, Patel Engineering, PFC, Pantaloon, Power Grid Corp., Puravankara, Reliance Infra, Siemens, Shoppers Stop, Sobha Developers, Sun Pharma, Suzlon, SBI, Sterlite, SAIL, Tanla, Tata Steel, Tata Tele, Tata Comm, Tata Motors, Trent, Titan, Thermax, Tulip Tele, Union Bank, United Phosphorus, Unitech Voltamp and Wockhardt.
Food Inflation Issue:
Food price inflation continued to soften in the week ended January 9 even as non-food prices witnessed a sudden spurt, data released by the Government showed. Despite the drop in food inflation from nearly 20% a few weeks earlier, the RBI will most likely boost the CRR if not the policy rates. For the week ended January 9, inflation for the Food Articles group fell to 16.81% from 17.28% in the preceding week, according to the Union Commerce & Industry Ministry. The index for Food Articles group declined by 0.1% to 285.6 from 285.8 for the previous week.
Inflation for the Non-Food Articles group jumped to 10.40% from 8.76% in the week ended January 2. The index for Non-Food Articles group rose by 1.9% to 257.9 from 253.2 for the previous week. Inflation for the Minerals group remained unchanged at (-) 5.18%. The WPI for the Primary Articles group rose by 0.4% to 284.6 from 283.4 in the previous week. The annual rate of inflation for the group stood at 13.93% compared to 13.82% for the previous week. It was at 11.87% during the corresponding week of the previous year.
The annual rate of inflation for the Fuel & Power group stood at 6.34% for the week ended January 9 compared to 6.25% in the previous week. It was (-) 1.41% during the week ended January 10, 2009. The index for this major group rose by 0.1% to 350.4 from 350.1 for the previous week. Inflation for the Mineral Oils group rose to 9.78% from 9.65% while that for the Electricity group stood unchanged at 1.95%.
India’s benchmark wholesale price inflation rate accelerated to 7.31% in December, the most in 13 months. That exceeded the central bank’s forecast of inflation touching 6.5% by March 31, 2010.
Disclaimer :
This document has been prepared by the Research Division of Integrity Financial Consultants Pvt. Ltd.,Pune, India and is meant for use by the recipient only as information.This document is not to be reported or copied or made available to others without prior permission of iNTEGRITY. It should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, iNTEGRITY has not independently verified the accuracy or completeness of the same. Neither iNTEGRITY nor any of its affiliates, its directors or its employees accept any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein.Recipients of this report should be aware that past performance is not necessarily a guide to future performance and value of investments can go down as well. The suitability or otherwise of any investments will depend upon the recipient's particular circumstances and, in case of doubt, advice should be sought from an independent expert/advisor. Either iNTEGRITY or its affiliates or its directors or its employees or its representatives or its clients or their relatives may have position(s), make market, act as principal or engage in transactions of securities of companies referred to in this report and they may have used the research material prior to publication.
Contact Details : email : info@integrity.org.in