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Midcaps Stole the Scene

The market sentiment was positive during the early part of the week with the Sensex closing above the 6000-point mark on two occasions. However, by Friday, the up move had come to an end with more than a per cent fall in the Sensex

The market sentiment was positive during the early part of the week with the Sensex closing above the 6000-point mark on two occasions. However, by Friday, the up move had come to an end with more than a one per cent fall in the Sensex as well as the Nifty. The BSE Sensex lost 0.04 per cent for the week to close at 5961.07 and the Nifty closed 0.03 per cent down for the week to close at 1872.35.

After an extended weekend, the markets opened on a strong note with the Sensex closing above the important psychological mark of 6000 points on two days-Wednesday and Thursday. This was not to last though. The markets fell on Friday, with Reliance leading the fall following reports of rift between the Ambani brothers. Reliance lost 3.37 per cent on Friday. On Friday, the Sensex and the Nifty lost 1.06 per cent and 1.04 per cent respectively. The turnover of the market had also increased on both the exchanges with the combined average turnover for the week exceeding Rs 6000 crore.

The rise in inflation to 7.76 per cent may have contributed to the fall in Sensex on Friday. However, with the government announcing a cut in petrol prices, the inflation figure may not be as high. Some amount of profit booking would also be responsible as the Sensex did close above 6000 level for two consecutive days.

The fall in the Sensex and the Nifty was not extended to the broader markets though. The S&P CNX 500 closed 0.47 per cent up at 1586.6 and the CNX Mid Cap 200 closed 2.19 per cent up at 2202.35.

Banking and technology shares were the stars of the week. Despite the fall in the Sensex and Nifty, the BSE Bankex rose by 5.46 per cent for the week and the BSE IT Index closed 1.89 per cent higher for the week. The rest of the indices closed in the red with the BSE Healthcare Index losing 1.58 per cent, the BSE FMCG Index declining 0.54 per cent and the BSE PSU Index closing down 0.03 per cent.

In the banking sector, the interest rate hike by ICICI Bank did arouse interest in the sector. Expectations of a strong credit growth was also one of the reason behind the improved sentiment. There was some interest in the steel counters with steel major SAIL announcing a hike in prices.

Outlook
The international oil prices went up on Friday and this may play on the sentiment in the market. Since the Reliance group companies--Reliance Industries and Reliance Energy--have a high combined weightage in the Sensex and the Nifty, any price changes in their prices may have a significant impact on the market. FII figures would be important.