Amidst high volatility, the BSE Sensex ended the week with a gain of 0.26 per cent at 5670 points compared to a 4.5 per cent fall in the previous week. The S&P CNX Nifty too advanced 0.46 per cent to 1804 points. The broader indices weren't far behind either with the S&P CNX 500 up about 1 per cent. Mid-caps were even more in demand with the CNX Midcap 200 gaining 2.35 per cent over the previous week.
The average turnover for the week declined 15.4 per cent to Rs 6,522 crore. The average advance-decline ratio was more than 1.5 for the week. The political uncertainty keeps FIIs out of the market. They were net sellers for the week to the tune of Rs 57 crore. Mutual funds too continued their selling spree for the third consecutive week, and were net sellers at Rs 44 crore.
The cloud of uncertainty that prevailed over the stock market last week continued to cast its shadow on Monday with the BSE Sensex falling 70 points to 5585 points. Markets bounced back on Tuesday surging 62 points to 5647 points ahead of the third phase of Lok Sabha elections. The positive mood continued on Wednesday with the Sensex gaining 39 points to 5686 points at the back of fresh exit polls, which indicated a favourable outcome for the NDA. Grasim and ACC results helped in improving the sentiment. The BSE Sensex rallied for the third consecutive day on Thursday, gaining 71 points to 5757 points on renewed hopes of NDA coming to power. But on Friday, the markets couldn't sustain the three-day rally, closing the week 88 points down to 5670. Among other corporate results in the week, Dabur India, Union Bank of India and UCO Bank came out with good numbers. Fear of a slowdown in the Chinese economy was also one of the factors in the decline last week.
In sectoral indices, the BSE PSU Index emerged as the biggest winner peers gaining 1.7 per cent. A combination of factors such as a possible return of the NDA government, expectations of good quarterly numbers and a hike in prices of petroleum products after the elections kept PSU shares firm. The BSE IT Index rose around 0.6 per cent. Technology heavyweight Wipro bagged an order from Royal Dutch/Shell group to the tune of $1 bn. The BSE Healthcare Index was marginally up 0.3 per cent. Dr. Reddy's announced purchase of a US firm Trigenesis and Wockhardt announced acquisition of a German company. The BSE FMCG Index declined 0.7 per cent as HLL's disappointing results continued to affect the sector. The BSE Bankex dropped 0.24 per cent despite good results from mid-cap PSU banks.
In global indices, the NASDAQ fell 0.11 per cent to 1918 points and the Dow Jones plunged 1.06 per cent to close at 10,117 due to the US Federal Reserve hinting that interest rates would go up gradually.
Outlook:
Political uncertainty, apprehensions regarding rise in US interest rates and the slowdown of the Chinese economy are putting pressure on the markets. The markets are expected to be range bound till the election results are announced. Next week, the markets are expected to chart direction on the hope that the final poll verdict will clear some clouds of uncertainty.
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