Defer your decision
When it is not necessary to make a decision, it is necessary not to make a decision.
After a successful week the bulls would like to consolidate their hold over the market. However, a public holiday on Tuesday and F&O expiry on Thursday may lead to extra volatility. Last week's rally, which came after five weeks of losses, was on lower volume. The market breadth was also negative on most days. It would be safer deferring to investment decisions by a couple of days. And if you are more or less fully invested, lock in some gains at every rise as a fresh fall is possible.
Expectations are this week will sail through with gains. For today, we expect a cautious to higher opening given the mixed closing on Wall Street on Friday and a similar trend in Asian markets this morning. Some short covering is likely to help lift the key indices, with some help from the foreign funds.
A combination of local and global factors will continue to drive sentiment in the near term, though the long-term outlook remains bullish. Inflation and interest rates will also continue to cast a spell on the markets. In a few days time, the quarterly earnings will start to flow in. Though most good news on corporate earnings is in the price, companies that exceed expectations will see some positive movement. Looks like we may not have a spectacular year of gains as has been the case in the past four years. At best one can expect good to moderate returns. Having said that, there are lots of opportunities in the small and mid-cap space if one hunts for them carefully.
FIIs were net buyers of Rs1.27bn (provisional) in the cash segment on Friday. In the F&O segment, they were net sellers to the tune of Rs1.68bn. On Thursday, FIIs poured in Rs7.13bn in the cash segment. Mutual Funds too were net buyers of Rs869mn on the same day.
Shares of Sparsh BPO Services Ltd. (formerly Intelenet BPO Services Ltd.) will be listed and permitted for trading with effect from Monday, March 26.
US stocks were mixed on Friday, but all the three major indices had their best weekly advance in eight months. The Dow Jones Industrial Average was up 19.87 points or 0.2% at 12,481.01 and managed to move back into the plus column for the year. The blue-chip average's weekly point gain of more than 370 was the best since March 2003, when it gained more than 660 points in a week. The broader S&P 500 gained 1.57 points to 1,436.11 and the Nasdaq was down 2.81 points at 2,448.93. All three major gauges rose at least 3% last week.
A strong housing market report and strength in auto stocks gave a boost to blue chip stocks. But broader gains were prevented by reports that 15 British marines were taken hostage by Iranian naval vessels. The news revived worries about instability in the Middle-East, and sent oil prices higher, with US light crude oil for May delivery adding 59 cents to settle at $62.28 a barrel on the New York Mercantile Exchange. The front-month contract was quoting 23 cents higher at $62.51 a barrel in extended trading in Asia.
COMEX gold for April delivery fell $6.90 to settle at $657.30 an ounce. Treasury prices slumped, raising the yield on the 10-year note to about 4.61% from 4.58% late on Thursday. In currency trading, the dollar gained versus the euro and was little changed versus the yen.
European stocks closed higher on Friday. The pan-European Dow Jones Stoxx 600 index rose 0.5% to 375.98. The German DAX Xetra 30 advanced 0.6% to 6,899.06, the French CAC-40 gained 0.7% to 5,634.75 and the UK's FTSE 100 added 0.3% to 6,339.40.
Asian stocks are mixed this morning. Markets in China, Taiwan and Hong Kong are in the green. The rest are marginally down. The Morgan Stanley Capital International Asia-Pacific Index slid 0.2% to 145.71 as of 10:49 a.m. in Tokyo, sliding from its highest since Feb. 27.
In the emerging markets, the Bovespa in Brazil rose 0.2% to 45,532 while the IPC index in Mexico added 0.05% to 28,272 and the RTS index in Russia surged 1.3% to 1914.
Bulls take a breather
Bulls took a breather on Friday as four days of winning streak came to an end. However, markets finally recorded first week of gains after falling for five consecutive week’s. The markets lost some steam as profit booking was witnessed in the FMCG, Technology, Auto and PSU indices. Today again the Mid-Cap and small cap index ended almost flat. However, buying interest in the heavy weights like BHEL, HDFC, HLL and Bharti Airtel lifted the NSE Nifty above the 3900 mark. Finally, the 30-share benchmark Sensex fell 22 points to close at 13285. NSE Nifty was down 14 points to close at 3861.
ITC declined by over 3.5% to Rs144 as Maharashtra also decided to impose a 12.5% VAT on all tobacco products except bidis. The scrip touched an intra-day high of Rs150 and a low of Rs143 and recorded volumes of over 1, 0,00,000 shares on NSE.
IFCI rallied by over 7% to Rs31 after the state-run term lender said it has appointed Ernst & Young, for advising the company on the induction of a strategic investor. The scrip touched an intra-day high of Rs32.20 and a low of Rs29.50 and recorded volumes of over 15,00,00,000 shares on NSE.
Torrent Pharma lost by over 3% to Rs197. According to reports the Ahmedabad-based company along with Israel's Teva is the only ones left in the race for the generic business of Germany's Merck. The scrip touched an intra-day high of Rs203 and a low of Rs195 recording volumes of over 19,000 shares on BSE.
Dabur surged by over 3.5% to Rs94 amid reports that it is to acquire Singapore's Unza Holdings. The scrip touched an intra-day high of Rs94.60 and a low of Rs90 and recorded volumes of over 31,00,000 shares on NSE.
Deccan Aviation slipped by 2% to Rs97 as yesterday the company announced that it was open to a search by the nation's airline regulator on an allegation that it overbooked passengers. The scrip touched an intra-day high of Rs99 and a low of Rs95 and recorded volumes of over 1,00,000 shares on NSE.
Auto stocks were in reverse gear. Tata Motors slipped by 2% to Rs789, Bajaj Auto has declined by 1.5% to Rs2529, TVS Motors was down by 0.8% to Rs62 and Ashok Leyland lodt 1.2% to Rs40.95.
Metal stocks shined brightly as metal prices on LME were firm. Sterlite Industries surged by over 5% to Rs486, JSW Steel gained 2% to Rs471 and SAIL added 0.9% to Rs112 and Hindustan Zinc was flat at Rs550.
Cement stocks also lost their gains towards the end on back of profit booking. ACC lost 1.2% to Rs744, Gujarat Ambuja was down 2.2% to Rs105, Grasim fell by 0.3% to Rs2080 and India Cement declined 0.7% to Rs164.
FMCG index was the major loser among all the sectoral indexes slipping by 1.20%. ITC fell over 3.5% to Rs144, Nirma was down by 1.9% to Rs163 and Tata Tea edged lower by 0.2% to Rs625. However HLL nearly rose by 1% to Rs198.