Weekly Wrap: Sensex extends winning streak

BSE, Sensex

The Sensex ended on a high note for the fourth successive week as participants, shrugging off a hike in CRR and Repo rates and concerns over high inflation, picked up blue chip stocks in a frenzied manner on two of the five sessions last week (July 28 - August 1, 2008).

A smart recovery in global markets and easing crude oil prices were among the factors that contributed to the buoyant mood. On Friday afternoon the mood turned quite upbeat after the IAEA governers, led by director Mohamed Elbaradei passed the India specific safeguards agreement and paved the way for India to move a step ahead on the Indo-US cililian nuclear deal.

While the Sensex ended the week with a gain of 381.75 points or 2.67% at 14,656.69, the Nifty settled with a gain of 101.70 points or 2.35% at 4413.55.

Inflation rose 11.98% in 12 months to 19 July 2008, above the previous week's annual rise of 11.89%. The government revised upwards inflation for the week ended 24 May 2008 to 8.9% from 8.24%.

While foreign institutional investors sold shares worth Rs 1836.80 crore in July 2008, domestic mutal funds were net buyers to the tune of Rs 1223.50 crore during that period.

Stockometer | Top gainers | Worst losers

After moving in a choppy fashion till around noon, the market rallied sharply on Monday afternoon and signed off on a positive note thanks to some strong buying in heavyweight stocks Reliance Industries, ICICI Bank, ONGC, Larsen & Toubro and Reliance Communications. The undertone remained quite cautious that day as investors appeared reluctant to make commitments ahead of RBI's monetary policy review.

However, the BSE barometer which had recorded a modest gain of 74 points on Monday, plunged sharply and suffered a massive loss off 558 points in the next session following the Reserve Bank of India hiking CRR and Repo rates by 25 basis points and 50 basis points respectively to 9 per cent. The Nifty ended with a big loss of 142 points.

And then, it was a surge up north for the Sensex and Nifty over the next three sessions. Thanks to a splendid rally across the globe and a sharp fall in crude oil prices, stock prices vaulted higher on Wednesday. Mirroring the impressive surge in values, the Sensex and Nifty flared up by 496 points and 124 points respectively on that day. Hectic short-covering ahead of expiry of July series derivatives contracts also contributed to the sharp upmove.

The bulls, notwithstanding some stiff resistance from their rivals, guided the market to a positive close on Thursday. However, as buying remained stock specific, gains were just modest this time around. While the BSE benchmark edged up by 69 points, the Nifty moved up by 19 points that day.

After a highly negative start, stock prices climbed up sharply on Friday, ignoring weak global markets. As stocks across the board joined the rally ignited by metal and capital goods stocks, the Sensex closed with a gain of over 300 points that day. The Nifty shot up by 81 points.

Tata Steel, backed by good quarterly numbers, scored a sharp gain of 10.2% last week. HDFC shot up by 8.1% on impressive surge in the company's net profit. Reliance Industries gained 7.1%. BHEL (6.1%), DLF (6%), Ranbaxy Laboratories (5.9%), Jaiprakash Associates (4.3%), State Bank of India (3.6%), Bharti Airtel (2.8%), Reliacne Infrastructure (2.6%) and Larsen & Toubro (2.5%) closed with notable gains.

ONGC and Hindustan Unilever recorded modest gains last week. Ambuja Cements (the stock moved out of the Sensex last week) and ACC ended with marginal gains. Tata Power and Sterlite Industries, the new entrants to the Sensex fold, ended stronger by 9.95% and 4.9% respectively.

IT majors Wipro (6.5%), Infosys Technologies (5.8%), Tata Consultancy Services (5.2%) and Satyam Computer Services (4.4%) too contributed significantly to the market's positive display last week.

Reliance Communications (down 13.2%), Maruti Suzuki (down 8.8%), Tata Motors (down 6.6%), NTPC (down 5.8%) and Mahindra & Mahindra (down 3.1%) declined on weak quarterly results. Cipla, which made way for Sterlite Industries in the Sensex, finished with a loss of 2.5%. ICICI Bank, HDFC Bank, ITC and Grasim Industries also closed weak.

Suzlon Energy, Cairn India, GAIL India, Reliance Petroleum, Hero Honda, BPCL and Siemens were the prominent gainers from the Nifty. SAIL, Tata Communications, Unitech, Sun Pharmaceuticals and HCL Technologies also closed with notable gains.

Dr. Reddy's Laboratories, Zee Entertainment, ABB, Nalco, Power Grid Corporation and ABB ended on a weak note.

FDC, Thomas Cook, Escorts, Torrent Pharma, Chambal Fertilizers & Chemicals, Gujarat Minerals, Punjab Lloyd, D-Link India, Bank of Baroda, ICI India, LIC Housing Finance, i-Flex Solutions, RNRL, Aditya Birla Nuvo, Bongaigaon Refinery and Gujarat Narmad were among the prominent gainers from BSE 'A' Group.

Among the sectoral indices, BSE Metal, which moved up by 6.07%, was the biggest gainer last week. The Oil & Gas moved up by 5.71% and the IT barometer ended with a strong gain of 5.23%. BSE CG (3.35%), PSU (3.76%), Realty (3.38%), CD (2.44%), Power (2.88%) and Teck (1.55%) also rose sharply.

The FMCG and Healthcare indices ended little changed from their previous week's closing levels. The Bankex eased by 0.34% while the Auto index weakened by 1.87%.

As far as midcap and smallcap stocks were concerned, the latter outperformed the former and advanced by 2.97%. The Midcap index edged up by 1.26%.

SEARCH