It was a week where stock markets clocked gains in each trading session. Over the week, the BSE Sensex was up 2.6 per cent while the Nifty gained 2.9 per cent. Receding war fears and expectations of an investor-friendly Budget were the reasons for this. Globally too, both the Nasdaq and the Dow Jones posted gains for second consecutive week. The Nasdaq gained nearly 3 per cent and the Dow was up 1.3 per cent.
Tech rally on Monday saw stock markets post heavy gains on the first trading day. The rise in the Nasdaq spread some cheer and IT heavyweights Infosys, Satyam and Wipro led the rally. However, during mid-week, IT stocks underwent a correction. The BSE IT Index gained 3 per cent over the week.
Among cement stocks, ACC made news this week with a 4 per cent gain. Market regulator SEBI asking Gujarat Ambuja Cement to make an open offer for a 20 per cent stake in ACC at a premium saw the ACC scrip post gains. On the other hand, PSU stocks, HPCL and BPCL, took a hit mid-week after the disinvestment minister announced that the divestment would take another 6-8 months. Over the week though BPCL and HPCL gained 8 per cent and 3 per cent, respectively.
Banking stocks too witnessed a lot of activity following the news that the government may allow increase in foreign stake -- currently fixed at a maximum of 20 per cent -- in PSU banks. Also, the government is likely to allow 100 per cent FDI investment in private banks. Among PSU banks, the index heavyweight SBI moved up 4.3 per cent over the week. Private banks like HDFC Bank and ICICI Bank also inched up marginally.
Lessening tensions in the Gulf saw the FIIs buy equities worth Rs 69 crore for the week. In comparison, they sold equities worth nearly Rs 100 crore last week. Domestic mutual funds, on the other hand, continued to sell this week too. By Thursday they had sold Rs 2.65 crore worth of equities, though much less than the previous week's Rs 70-crore figure.
Apart from all this, the week saw SEBI announce new guidelines for delisting. A company, which wants to delist from a stock exchange, will now determine the exit price through the book-building process, which will be the average of the 26-week traded price. In a significant development, the BSE suspended trading in 17 companies whose dematerialised securities were being traded without permission. Special margin on 37 scrips is also to be introduced as a risk-control measure by the BSE.
In another important development, the Cabinet Committee on Economic Affairs (CCEA) approved futures trading in 54 commodities. These include rice, wheat, pulses, yarns and cloth. Also, gold, silver and copper will be permitted for trading in the futures market. This move is likely to bring stability in the price of these commodities.
Outlook
Stock markets may remain volatile ahead of the Budget next week. Fears of a possible war in the Gulf region still remain, which may affect the market sentiment.
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