For the fourth successive week in a row, stock markets moved up. While the Sensex gained 0.96 per cent, to close at 3921.2 points, the Nifty rose by 2 per cent to close at 1247.75 points. Mid-cap stocks, however, continued to lead the rally and the CNX Midcap 200 Index was up nearly 3 per cent. The broader S&P 500 also moved up by 2.17 per cent.
The rally was widespread as can be seen from the advance decline ratio, which remained above one for most days of the week except Tuesday. Average trading volumes on both the exchanges together (Rs 5568 crore) were also strong. FIIs continued to repose faith in India equities. They pumped in Rs 731 crore while mutual funds were net sellers to the tune of Rs 14 crore.
Among the sectoral indices, the BSE PSU posted the highest gains of 4.19 per cent. Steel stocks were at the centre of this charge. Steel Authority of India gained nearly 25 per cent. Other steel stocks such as Jindal Vijaynagar Steel, Ispat Industries and Essar Steel also made major gains. Most steel stocks touched their 52-week highs.
A part of the sharper move by the Nifty is attributed to the entry of SAIL into the index and its sharp upmove in the past week. The surge in SAIL in particular has propelled the stock into the list of ten largest stocks by market capitalisation.
Other index stocks, which reached their yearly highs, were Grasim Industries and BHEL. In another significant development Maruti Udyog has entered the MSCI Index. The stock closed the week at Rs 210.85.
The other significant gainer among sectoral indices was the BSE FMCG index, which was up 3.07 per cent. The BSE Bankex and the BSE Healthcare also posted modest gains of 0.34 per cent and 0.77 per cent respectively. IT stocks, however, received a drubbing and the BSE IT Index fell by 4.37 per cent. Concerns about the rising rupee hurting the export revenues of IT companies played spoilsport here. Among large-caps HCL Technologies and Wipro were the biggest losers, falling by 5.19 and 3.47 per cent respectively.
In overseas markets, the Dow Jones and the NASDAQ continued to do well, gaining 1.29 and 2.61 per cent respectively.
Outlook:
Volumes as well as advanced-decline numbers indicate that markets are in the hands of bulls. The continuation of this bullish trend will, however, depend on sustained inflows from foreign institutional investors. Intermediate corrections can also not be ruled out.
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