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Unbridled Optimism

A good week indeed! Yuvraj Singh set a record and the Sensex scaled a new high, despite there being no correlation between the two. The rupee hit a 9-year high. Oil and gold soared

On Monday, mid-caps did well but the larger indices closed in negative territory. Hardly surprising. Globally the situation was bleak. The markets in Brazil, Mexico, Turkey, Hong Kong, Tokyo, Taiwan, Singapore and S Korea closed lower.

US stocks closed marginally lower ahead of the Federal Reserve meeting. Citigroup, Bank of America and Merrill Lynch led the fall among financial companies and Microsoft fell after losing a European antitrust appeal. S&P 500, Dow Jones Industrial Average and the Nasdaq Composite Index all fell. Former Fed chief Alan Greenspan went on record saying that the risk of recession in the US is greater now than it was at the beginning of the year and the current crisis was "an accident waiting to happen". In London, mortgage lender Northern Rock tumbled to a 7-year low.

While the markets rose on Tuesday, Hexaware Technologies fell on speculation that General Atlantic will sell its stake in the India computer services provider.

If the markets picked up on Tuesday, they soared on Wednesday. In fact, the Sensex actually crossed 16,000 for the first time and the Nifty too scale a new high. This was on the back of US Federal Reserve cut being more than expected. RIL, SBI, DLF, BHEL, SAIL, Tata Steel and RPL hit their respective lifetime highs. Banking stocks rallied after the Fed's decision. Sugar stocks appreciated as the government said it would allow mills to make ethanol directly from cane juice. Cement stocks rose because cement manufacturers increased prices. Despite the rupee appreciating to reach its highest in 9 years, infotech stocks rose.

The euphoria continued on Thursday. The rupee appreciated and infotech stocks fell. In New York and London, gold rose to a 27-year high and the dollar sank to a record low against the Euro. Metal stocks appreciated and Hindalco, Hindustan Zinc and Hindustan Copper all rose. Realty stocks were the star performers. Unitech, DLF, IB Real Estate and Ansal Infrastructure all rose. Simplex Infrastructure surged after the company announced that it has secured new contracts worth Rs 8 billion. The disappointing news was that oil rose to $82/barrel.

Finally, Friday closed on a positive note with the Sensex scaling a new high of 16,500+.

Vital Stats: September 17- 21, 2007
   Sensex   Nifty   BSE Mid Cap   CNX Midcap
Mon 15,504.43 4,494.65 6,915.37 6,311.50
Tue 15,669.12 4,546.20 6,985.03 6,393.95
Wed 16,322.75 4,732.35 7,116.61 6,518.45
Thu 16,347.95 4,747.55 7,132.71 6,584.10
Fri 16,564.23 4,837.55 7,199.92 6,622.75
Net Buying (Equity)
   FII   MF     
Mon -267.40 -203.60  
Tue -137.40 -19.00  
Wed 2484.50 488.10  
Thu 1629.50 -233.40  
Figures in Rs/crore
   BSE Turnover   BSE Shares   NSE Turnover   NSE Shares
Mon 4688.76 3773.00 9395.87 4817.25
Tue 5618.94 4336.00 10933.30 5481.34
Wed 7487.67 4975.00 16494.74 6879.30
Thu 7220.51 4851.00 14770.97 6768.21
Fri 8279.52 6654.00 16687.13 10146.20
Number of shares in lakh. Turnover in Rs/crore.

BSE Auto, BSE CG (capital goods), BSE PSU rose consistently the entire week. BSE Metal soared from 12,011 on Monday to 12,812 on Friday. Ditto for BSE Oil & Gas which moved from 8,372 to 9,340 and BSE Realty which moved from 7,928 to 9,183.

BSE Healthcare and BSE IT had a volatile week. Little wonder that Infosys (-0.46%), TCS (-0.75%), Wipro (-2.30%), Satyam (-2.75%), Dr Reddy's (-0.09%), Ranbaxy (-1.97%) and Cipla (-2.70%) were the only Sensex losers.

The biggest Sensex gainers were Reliance Energy (14.38%), RIL (11.79%) and ONGC (10.74%).