The first two days of the week certainly belonged to the bears. On Monday, the Nifty and Sensex tumbled. The Sensex recorded its second biggest single day fall and the Nifty, its biggest. It was not only the large-caps that were hit but even small- and mid-cap stocks tumbled. Tuesday began with some hope when the market opened with a positive gap. But it turned choppy later and witnessed wild intra-day swings. The day ended with the indices closing lower.
Wednesday was different though. After struggling for four sessions, the bulls prevailed, but not without a fight. Volatility was persistent though. After opening with a positive gap up, key indices erased all its gains in the afternoon trades. Later in the day bulls fought back managing to end the day with modest gains. On Thursday, the bulls had the last word. Accenture Ltd raised its earning forecast for the year and tech stocks rose. Project Financier IFCI dropped drastically (by 23%) after it scrapped a plan to sell a stake to a strategic investor.
The weak global market, expensive valuations back home and slackening FIIs inflows have resulted in bad sentiment. Fears that inflation in the US will curb spending and limit further interest rate cuts and result in slowing of investments into emerging markets also persist. Later in the week, the injection of huge funds by the European Central bank (ECB) and steps taken by other western central banks to reign in the carnage in credit markets helped prop up sentiment across global markets.
When comparing the previous week's close with this week, not many of the Sensex stocks gained. In fact, just 5 of them did: Satyam Computers (4.04%), Infosys (3.13%), Reliance Energy (1.59%), Cipla (0.86%), TCS (0.08%). The biggest losers were HDFC (-10.92%) and ACC (-9.12%).