Markets - Weekly Wrap

The 30 share index, Sensex, gained 229.65 points during the week ended Feb. 29, 2008, to close at 17,578.72, whereas the broad based NSE Nifty advanced 112.75 points to close at 5,223.50.


On Monday, the BSE Sensex ended the day with a gain of 301.50 points, or 1.74%, at 17,650.57, while the broad-based NSE Nifty closed at 5,200.70, up 89.95 points, or 1.76%. The 30-share benchmark index opened with a positive gap of 174.74 points at 17,523.81 on account of good global cues in the early trades. Later, the index fell into the negative and traded for a long period in the negative terrain. However, the index recovered and moved up in the positive zone. The index proceeded to trade high on the back of intense buying interest in frontline stocks before the final hour of the closing to touch a high of 17,674.06.

On Tuesday, the BSE Sensex ended the day with a gain of 155.62 points, or 0.88%, at 17,806.19, while the broad-based NSE Nifty closed at 5,270.05, up 69.35 points, or 1.33%. The 30-share benchmark index, Sensex, opened with a positive gap of 148.99 points at 17,799.56 mirroring buoyant global cues in the early trades. Finally, the index closed on a firm note after touching an intraday high of 17,860.10.

On Wednesday, BSE Sensex ended the day with a marginal gain of 19.80 points, or 0.11%, at 17,825.99, while the broad-based NSE Nifty closed at 5,268.40, down 1.65 points, or 0.03%. The Sensex, opened with a positive gap of 177.23 points at 17,983.42 following encouraging global cues in the early deals. Later, the index proceeded to trade in the positive terrain on account of sustained buying activity in frontline stocks. However, the index could not sustain its ground and slipped into the negative. However, it moved up in the positive terrain before the final hour of the closing. Finally, the index closed on a flat note after touching an intraday high of 18,137.28.

On Thursday, BSE Sensex ended the day with a marginal loss of 1.51 points, or 0.01%, at 17,824.48, while the broad-based NSE Nifty closed at 5,285.10, up 16.7 points, or 0.32%.The 30-share benchmark index, Sensex, opened negative at 17,810.52 but soon moved up in the positive for a brief period. However, it again fell into the negative in the early trades due to weak global cues. The index proceeded to trade in the negative on the back of intense selling pressure in frontline stocks amidst volatility. Finally, the index closed on a flat note after touching an intraday low of 17,690.16.

On Friday, the BSE Sensex ended the day with a loss of 245.76 points, or 1.38%, at 17,578.72, while the broad-based NSE Nifty closed at 5,223.50, down 61.6 points, or 0.32%. The indices opened on a negative note at 17,779.54 on the Union Budget day. The 30-share index later fell by 400 points as soon as the Finance Minister P. Chidambaram unveiled the Budget. However, the Sensex recovered smartly before the final one hour of trading backed by Pharma, FMCG, banks and auto stocks. Finally, the BSE barometer wrapped the day on a dull note after touching an intraday low of 17,258.20.

Economy

Pushing for reforms, the Economic Survey stated that inflationary impact of foreign funds flow, a slowdown in the US, an appreciating rupee and sluggish infrastructure sector were major challenges before economy that is projected to slow down to 8.7% in 2007-08.

India`s wholesale price inflation rose 4.89% for the week ended Feb.16, 2008, as against 4.35% for the previous week.

All India Consumer Price Index Number for Industrial Workers (CPI-IW) on base 2001=100 for the month of January 2008 remained stationary at 134. The point to point rate of inflation, during January 2008 based on the CPI-IW on base 2001=100 has remained constant at the previous month`s level of 5.51%.

Budget 2008-09

To give a boost to the agricultural sector, the scheme of Debt Waiver and Debt Relief for farmers has been announced by the Finance Minister, P Chidambaram. All agricultural loans distributed by scheduled commercial banks, regional rural banks and cooperative credit institutions upto Mar. 31, 2007 and overdue as on Dec. 31, 2007 will be covered under Debt Waiver and Debt Relief scheme.

For marginal farmers and small farmers there will be a complete waiver of all loans that were overdue on Dec. 31, 2007 and which remained unpaid until Feb. 29, 2008. In respect of other farmers, there will be a One Time Settlement (OTS) scheme for all loans that were overdue for the above period. Under the OTS, a rebate of 25% will be given against payment of the balance of 75%.

In the General Budget 2008-09, Banking Cash Transaction Tax (BCTT) has been withdrawn w.e.f. Apr. 1, 2009. The step is in view of the fact that the information gathered by means of BCTT is also available to the Income Tax Department through other instruments introduced in the last few years.

Gross Domestic Product (GDP) grew at 8.4% for the third quarter (October- December) 2007-08 as against 8.9% 2007-08 according to the Central Statistical Organization (CSO) at factor cost.