Markets continued their upward movement in the week gone by. The Sensex gained 4.74 per cent to close at 4768.9 points, while the Nifty gained 5.01 per cent to end the week at 1523.1 points. This sharp movement was propelled by FIIs who were net buyers on all trading sessions. Net FII investments during the week stood at a record Rs 1,920 crore. To put this in perspective it must be recalled that FII investment in the month of September was Rs 3,850 crore, which in itself was a record.
These gains were spread across the market with the CNX Midcap 200 gaining 4.63 per cent and the S&P CNX 500 moving up by 3.63 per cent. The advance decline picture was mixed but the week ended with declining issues outnumbering advancing ones. Average trading volumes on both exchanges together were 14 per cent higher than the previous week.
The most significant development of the week was Infosys's second quarter results, which beat analyst expectations and the company's own projections. Top-line growth in the quarter was 29 per cent while the bottom line increased by 33 per cent over the same quarter last year. Sales guidance for the year has been increased by 2-3 per cent to Rs 4,550-4,578 crore. The Infosys stock thus gained 3.94 per cent on the last trading session to close at Rs 4,608.65. These results buoyed the sector as a whole and Wipro and Satyam, gained 10.83 and 9.35 per cent respectively, with most of the gains coming on the last trading session. Satyam Computers in fact touched a new 52-week high of Rs 282.5. On the whole the BSE IT Index gained 5.62 per cent making it the winner among sectoral indices.
The other big result of the week was that of HDFC Bank. For the quarter ended September 30, 2003 net profits increased by 30.6 per cent to Rs 117.14 crore. A compared to this net profits in the corresponding quarter last year stood at Rs 89.69 crore. The HDFC bank stock gained 3.3 per cent to close the week at Rs 303.80. Other bank stocks were also moving in positive territory and the BSE Bankex recorded gains in every trading session to end the week up 5.19 per cent.
Defensive sectors like pharma and FMCG also recorded gains, though at a more modest pace. While the BSE Healthcare Index gained 3.56 per cent the BSE FMCG Index was up by 2.22 per cent. After two weeks of rapid-fire gains PSU stocks also moved at a relaxed pace. HPCL lost 6.9 per cent and the issue of the privatisation of IOC's retail distribution network did not help matters. The BSE PSU index closed the week with gains of 2.24 per cent.
Among index stocks the biggest gainers were Tata Chemicals (20.97 per cent), Tata Motors (16.73 per cent) and Mahindra and Mahindra (15.92 per cent).
Overseas the Dow Jones gained 1.07 per cent, while the NASDAQ composite rose by 1.85 per cent.
Outlook
With the results season starting on a positive note and FII inflows increasing by the day, markets should continue their upward march. If results from other frontline technology companies replicate those of Infosys, IT counters could also witness a re-rating.
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