Another milestone crossed tirelessly looking ahead at 19000, the bulls continued to gallop. From Monday to Thursday there was no let up in the rally, with extremely high turnovers each day. Increasing liquidity from foreign funds and a general bonhomie in Asian markets kept the momentum up. It was only on Friday that the markets displayed weakness and this was in spite of robust data on industrial output as well as stabilising domestic political factors. On Friday industrial output showed a one year growth of 10.7 per cent as of August, this was much higher than the 7.5 per cent witnessed in July.
However, this historic rally has left smaller companies high and dry. So while BSE Sensex rose 6.29 per cent during the week and the Nifty did a tad better locking a 7 per cent increase, mid cap companies looked awfully neglected. The BSE midcap index clocked an abysmal 0.01 per cent increase while CNX midcap regressed by (-) 0.4 per cent. FII's continued to impress us with their might, pumping in a net Rs 8109.9 crore, while domestic mutual funds couldn't resist booking profits, pulling out a net Rs 1381.8 crore.
The big question since the beginning of this rally has been whether the quarterly results of India Inc will live up to the attention. While Infosys did stage a good performance, it failed to impress investors. Inspite of posting a strong growth in volumes, revenues, (8.8 per cent quarter on quarter growth), profits (1.9 per cent), and operating margin (2.5 per cent) investors were not impressed and the stock was amongst the top losers in the 30 stock sensex during the week. The lack of investor confidence stemmed primarily from the company's pessimistic forecast of the forthcoming quarter. The Infosys result stopped the rise of BSE IT sector in its tracks. While the BSE IT rose 2.5 per cent and 3.24 per cent on Tuesday and Wednesday respectively, it fell by (-) 5.6 per cent on Thursday - the day Infosys announced its results.
But there was better news elsewhere. The best performing sectors where BSE capital goods which surged by 5.53 per cent during the week, followed by BSE metal and BSE Oil & Gas which appreciated 5 per cent and 4.61 per cent respectively. Even BSE Auto witnessed gains of 2.77 per cent while BSE Realty rose 2.56 per cent. Weakness in banking stocks was apparent and the sector palled in comparison to other sectors with a 0.93 per cent growth. This weakness is likely to continue with a CRR hike becoming imminent on or before October 31.
Amongst the sensex companies, the top five gainers during the week where Reliance Energy Ltd (13.07 %), ONGC (13%), Reliance Communications Ltd (11.32%), Mahindra & Mahindra Ltd (10.22%) and Larsen & Toubro Ltd (8.79%). While the top five losers list was consisted of Dr. Reddy'S Laboratories Ltd (-5.81%), Infosys Technologies Ltd (-2.98%), Bajaj Auto (-2.67%), Cipla (-2.22%) and Satyam Computer Services Ltd (-1.32%).
Ask Value Research 
New episodes every Friday 
New Process Alert 
Seems like you've uploaded a wrong QR code. Please upload the QR code downloaded from MF Central platform.
