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Rumours Halt Recovery

Equity markets applied brakes after the previous two weeks' surge. Nifty was down 1.67 per cent, while the Sensex lost 0.94 per cent in the week ended July 7

Equity markets applied brakes after the previous two weeks' surge. Nifty was down 1.67 per cent, while the Sensex lost 0.94 per cent in the week ended July 7. Among the broader indices, S&P CNX 500 lost 1.10 per cent, while the CNX Mid Cap ended the week down 1.53 per cent.

The sectoral indices also recorded negative returns this week with BSE Bankex (up 0.44 percent) being the only exception. BSE IT and Healthcare indices were down by 1.11 per cent each. The BSE FMCG index which was the top gainer among the sectoral indices last week, lost 0.46 per cent. The PSU index recorded a loss of 0.98 per cent. The top loser among the sectoral indices was BSE Metal which lost around 1.90 per cent during the week. Last week the metal index had posted a gain of 1.95 per cent.

On Monday the markets rose and according to some market players, the bull operators may have tried to push up the markets since Tuesday was a holiday in the US on account of the Independedce Day. The 50-share Nifty was up 1 per cent over its previous close and Sensex rose around 1 per cent after witnessing a low of 10589.46 and a high of 10729.92 to finally settle at 10695.26 points. It was the day of the technology stocks. Frontline IT companies like TCS were among the top gainers, rising 3.7 per cent per cent to Rs 1,800. Infosys was up 2.4 per cent (Rs 3,152) while Satyam closed the day with a gain of 1 per cent to Rs 719. The BSE IT index gained 1.5 per cent.

On Tuesday, heavy rains in the financial capital of India put life out of gear. Though it dampened the sentiments, the fall was modest. Nifty lost 12 points to close at 3138 levels, while Sensex was down 33 points to settle at 10662.22. FMCG stocks took most of the beating from bears. ITC and Hindustan Lever lost 2 per cent each. However, banking stocks rocked. Of the 18 stocks in the BSE Bankex, as many as 16 stocks registered gains. Prominent gainers were Bank of Baroda, Vijaya Bank, Punjab National Bank and SBI. FIIs were net buyers to the extent of Rs 254 crore, an additional Rs 148 crore over the previous day's shopping.

Domestic shares were the best performers among key Asian markets on Wednesday. The 30-share Sensex was close to the psychological mark of 11,000. The Sensex closed at 10919.64 points, up 2.4 per cent or 257 points. The Nifty surged 58.55 points or 1.9 per cent to close at 3197.10. Shares in other Asian markets like Japan, South Korea, Singapore, Taiwan and Hong Kong ended around 1 per cent lower following missile tests by North Korea.

Tata Steel was among the top gainers, surging around 4.9 per cent to close at Rs 563.85. The surge in Tata Steel was attributed to the chairman Ratan Tata's suggestion that Tata Sons would hike its holding in the company to ward off any takeover threat.

Thursday was the day when markets tanked due to the lack of confidence among the bulls. Nifty was down 40.70 points to end at 3156.40 points, while Sensex shed 151.67 points to close at 10767.97 points. Technology stocks were the worst performers with the top players like Infosys, Wipro, TCS and Satyam losing 1 per cent, 1 per cent, 2.4 per cent and 3.5 per cent, respectively.

However, cement stocks defied the bearish market.

The combined turnover of both the exchanges was Rs 8,343 crore. This was day when foreign funds found buying opportunity and their net purchases stood at 556 crore, the highest in the week.

The market tanked on the last day of the week on the rumours that the Prime Minister may step down due to the continuous resistance from the Left over the disinvestment. Nifty was down 80 points to close at 3076 points, while Sensex was down 258 points to close at 10509.53 levels.

Automobile and metals were the worst performers on Friday. The combined turnover was highest for the week at Rs 9,828 crore.

The FIIs were net buyers, with their net purchases being Rs 1140.8 core. It may be noted that during the previous week the FIIs were net sellers to the extent of Rs 450 crore. Domestic mutual funds were net sellers this week, taking out around Rs 432 crore over the week from the markets.