Strong Q2 GDP growth data, firm global markets and short covering in derivatives segment due to expiry of November derivatives contracts pushed Sensex up 80 points on Thursday (30 November). The market sentiment remains bullish due to strong FII-inflow and an upward revision in earnings growth of corporates by brokerages, on the back of strong Q2 results. The market would today eye monthly auto sales.
As per provisional data, FIIs were net buyers to the tune of Rs 88 crore on Thursday. Though FIIs were net sellers for the second day in a row on Wednesday (29 November), their outflow on that day of Rs 63 crore was much lower than Tuesday (28 November)’s Rs 335.30 crore.
Cumulative inflow of FIIs for November 2006 totaled Rs 9380.10 crore (till 29 November). FII inflow in November included their subscription to IPOs of Parsvnath Developers, Lanco Infratech and Info Edge India. There are expectations that FIIs may step up buying this month as allocations will be made for New Year calendar 2007.
But profit taking may cap further upside from the current level with the Sensex having risen sharply in the past few weeks. From 12,623.28 on 23 October, the BSE Sensex is up 8.5% in a little over a month.
Asian stock markets were mixed on Friday, with Japanese stocks rising and South Korean shares touching a six-month high, while Australia and Hong Kong dropped back from recent life highs.
US stocks ended little changed on Thursday as a report showing slowing Midwestern business activity offset gains in energy stocks on the back of rising oil prices. The Dow Jones industrial average fell 4.80 points, or 0.04 percent, to end at 12,221.93. The Standard & Poor's 500 Index rose 1.15 points, or 0.08 percent, to finish at 1,400.63. The Nasdaq Composite Index inched down just 0.46 of a point, or 0.02 percent, to close at 2,431.77.
Oil slipped more than half a percent, as profit-taking took the steam out of a four-session rally driven by a fall in US winter fuel stocks that had pushed prices to a two-month high above $63 a barrel. NYMEX crude for January delivery fell 34 cents to $62.79 a barrel, partially reversing a 67 cent rally on Thursday, when prices pushed up to their highest since Sept. 28.