Bulls die another week
The market consolidated during the week amid high volatility as investors were not prepared to take a fresh after the recent carnage. However, the Indian market did well to recover from another big crash on Tuesday. Stock markets across Asia fell sharply after Thai regulators imposed severe capital controls to cap gains in its currency, the baht, against the dollar. Thai stocks plunged by 16%, prompting the central bank there to relax the rules partially. The rollback lifted the spirits of the bulls yet again, though lack of buying support, especially from FIIs meant that the key indices could not make much headway. The market witnessed sharp intra-day swings due to the lack of any major positive triggers. Inflows from overseas investors remained volatile.
Capital Goods, FMCG, Banking and Sugar stocks declined. However, new discoveries in the KG basin by ONGC and Reliance provided some cheer to the bulls, preventing the indices from a major fall. ONGC, Tata Steel, Maruti and Reliance were the major gainers. The benchmark BSE Sensex lost 1% or 143 points to close at 13471.74 and the NSE Nifty closed the week at 3871.15, down 17.5 points or 0.45% after touching a high of 3934 and a low of 3768.8.
Auto stocks were in top gear, reversing last week's losses. Value buying was seen in auto stocks, led by Maruti. The scrip added 2% to Rs925 after the Cabinet approved the sale of the Government's remaining stake in the country's leading carmaker. M&M also surged by over 7% to Rs870. The company, through its subsidiary agreed to acquire 90.47% stake in Schoeneweiss & Co. GmbH, Germany. Others like, Hero Honda paced ahead by 2.6% to Rs749, Bajaj Auto gained 0.7% to Rs2590 and Tata Motors was up 0.2% to Rs859. Tata Motors entered into a JV with Thailand's Thonburi Automotive Assembly Plant Co. to manufacture, assemble and market pickup trucks.
Capital Good stocks continued to slide lower led by BHEL. The scrip fell by over 7% to Rs2310, L&T dropped 1.3% to Rs1004, Punj Lloyd dipped 2.3% to Rs987 and Siemens was down 1% to Rs1120. Oil & Gas stocks outperformed the key indices. ONGC led from the front. The scrip surged 6.5% to close at Rs869 on reports that it had found new reserves of natural gas and oil. Reliance was up 1.4% to Rs1031. The company is also said to have struck oil in the KG basin. Among the other oil stocks IOC advanced 2.1% to Rs444.
Profit booking dragged the IT stocks down. Index heavy weight Infosys lost 2.7% to Rs2171, Satyam declined 3.1% to Rs462 and TCS edged lower by 0.5% to Rs1151. Among the Mid-Cap stocks i-flex slumped over 10% to Rs1803, Financial Technology slipped 8.5% to Rs1732 and HCL Tech was down 2.5% to Rs605 despite winning a US$200mn order.
Banking stocks were also on the receiving end. HDFC Bank slipped 4.8% to Rs1005, SBI dipped by 3.9% to Rs1214, ICICI Bank fell over 1.5% to Rs856. Among the Mid-Caps, Bank of Baroda lost 5.2% to Rs233, Punjab National Bank was down 2.3% to Rs495 and Bank of India fell 1.355 to Rs189.
Sugar stocks pared early gains towards the end of the week with Renuka Sugar, Bajaj Hindusthan and Oudh Sugar among the leading losers. Earlier in the week, sugar stocks regained some momentum amid reports that the Government had partially lifted a ban on exports. Sugar companies with advance licenses will be permitted to release sugar as a matter of export. Renuka Sugar lost over 12% to close at Rs418, Uttam Sugar fell 4.7% to close at Rs129 and Mawana Sugars declined by over 5% to close at Rs49.
Tech Mahindra was clear the star performer of the week. The scrip hit its maximum limit on Dec 21 and soared further to close at Rs1654, advancing by a whooping 46.7% during the week. The scrip received a huge boost after the company won an order valued in excess of US $1bn from its UK-based partner, BT Group.