The deteriorating macro-economic picture, persistent FII outflows and grim global scenario are fuel for the bears. Nevertheless, the correction in commodities and crude oil hinders them. The market is precariously poised at this stage, and the risk of a sharp dip and an upsurge are evenly balanced.
This week though had a lot of action.
- Telecom infrastructure solution provider Nu Tek India got listed.
- Oil prices inched upwards before reversing course.
- Inflation surprisingly dipped.
- Infosys announced the country's biggest ever acquisition in the IT space when it acquired UK-based SAP consulting firm Axon for $753 million. In the long run, it is expected to boost the company's business in the UK and Europe.
- On Thursday was the F&O expiry. September Nifty futures contracts witnessed strong build up and the premium too increased. This indicates that traders are bit more positive on the new series.
- Currency Futures were launched on the NSE.
The market over the week
On Monday, the market gave up early gains as traders and individuals preferred booking profits at higher levels. Nevertheless, key indices managed to end with modest gains. HDFC, ICICI Bank, HDFC Bank and Bharti Airtel were among the major gainers. On the other hand, Reliance Industries, BHEL and Tata Power were among the major laggards.
Tuesday was pretty much the same. Another day of dull trade, where the market managed to end with modest gains thanks to banking, auto and IT stocks.
The winning streak was snapped on Wednesday on the back of weak global cues and a spike in the crude oil prices. Interest rate sensitive stocks like banking and realty were under pressure ahead of inflation figures to be announced on Thursday. The Sensex and Nifty were down as well as the BSE Realty and BSE Bankex indices. The BSE Mid-Cap and Small-Cap indices also lost ground. RIL, ICICI Bank, HDFC and SBI were among the major laggards while Infosys, Hindalco and Tata Steel managed to buck the negative trend.
Thursday was no better. All BSE sectoral indices ended in the red along with the Nifty and Sensex. Satyam, Tata Power and Ranbaxy managed to close in the green.
The week ended on a cheerful note with the bulls calling the shots on the back of a fall in wholesale price inflation to 12.40 per cent. After crude oil’s rise, it dipped to $115.59 a barrel on Thursday. A better than expected growth of the U.S. economy and forecast of a brighter outlook for the Japanese economy added to the sentiment. The marginal drop in inflation coupled with a GDP growth of just 7.9% in the June quarter raised speculation that the RBI would not announce any monetary tightening measure in the near future.
The Sensex, which closed at 14,048 on Thursday, ended the week at 14,564.