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Markets this week
Severe inflation hang-over, weak global markets cues and steep fall in commodities set a negative direction for the Sensex on Monday. The bears managed to resurface but failed to wrest full control from the bulls. After a seesaw battle, the bears gained marginally to take the Sensex down by 80 points to finish at 14640.
Investors dumped the shares of Hindalco Industries as the rights issue at Rs. 96 per share was well below the current market price of Rs 132. The stock was down by 4.53 per cent at Rs 129 with a surge in volumes.
M&M’s joint venture with Yancheng Tractor Company of China helped it to gain a foothold in the fast-growing Chinese tractor market besides providing a fillip to exports to US and Europe. The stock was not reacting positively to the news and finished marginally in the red at around Rs 670.
Star Group and Balaji Telefims have decided to terminate their agreement under which Star held a 25.99 per cent stake. The promoters of Balaji Telefilms would be allowed to buy back the 25.99 per cent Star stake at Rs 190 a share. The share price of the company turned weak as this development was viewed a negative one.
Mutual funds seem to be playing safe as they continue to sit on cash piles even as the equity markets exhibited a marked improvement since July on the back of softening crude prices. The cash levels maintained by fund managers reflect their perception of the markets and their expectations, aver analysts.
Shipping stocks are currently somewhat adrift, as rates remain off peak. With the Beijing Olympics now under way, and the relatively less active summer season in full swing, overall demand and rates reflect a flat trend.
"NSE goes live with currency futures from August 29, and mock trading sessions are being conducted from today,” said an NSE official on Wednesday. Parents paying for children’s overseas education, those getting remittances from abroad, or the outbound travellers can benefit from this facility.
A Merrill Lynch has it that out of 25 equity markets around the world, India was among the three that posted positive return in equity for July. But analysts preach caution as Indian markets are still in a bear phase where occasional strong pullbacks occur.
Index options traded value on the NSE was up sharply by 224 per cent in July as compared with February 2008. Analysts feel it’s a safer bet on the option market in a volatile phase than taking position in the futures market.
The market rally helped some eight mid-cap schemes to emerge among the top 25 open-ended diversified equity plans over one month time-frame. After a prolonged slump, equity markets witnessed a rally owing to factors such as steady global equity markets and easing crude oil prices.
The new 39 counters that entered the derivative segment on Thursday lost between two and seven per cent. The NSE last week announced that it would include 39 more stocks in its F&O segment from Thursday, bringing the total number of stocks traded to 267.
The annual WPI Index-based inflation rose to 12.63 per cent for the week ended August 9, above the previous week’s year-onyear rise of 12.44 per cent, according to Government data. Though the data was released after market hours, it was sensed in advance by investors who went on a selling spree, pulling the Sensex down by whopping 430 points to finish at 14240.
The IPO of Vishal Infotech, which made its debut recently at Rs 140, zoomed to touch an intra-week high of Rs. 328 accompanied by huge volumes with frenzied trading. Analysts however caution investors, citing the recent IPOs which are trading below par.
On Friday, the Sensex narrowed the gap down by 110 points at 14130, and traded in a range before making a leap, shrugging of inflation fears and scaling further peaks to finish the day at 14400. The Sensex pared around 250 points on a weekly basis, giving clear indications that it was still on a sticky wicket.
Compiled by B. L. Sudarsan
Podcast by R. Venkatesan
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