Market gains for 4th straight week

The market edged higher for the fourth consecutive week as world stocks rose on speculation policy makers in the US and China will ease monetary policy to boost growth in the world's two biggest economies. However, gains were capped as rally in the global markets fizzled out on Friday, 24 August 2012, after a US Federal Reserve official threw cold water on the notion that another round of stimulus from the Federal Reserve is on its way. The BSE Sensex rose 92.13 points or 0.52% to 17,783.21. The 50-unit S&P CNX Nifty rose 20.40 points or 0.38% to settle at 5,386.70. The BSE Mid-Cap index fell 0.63% and the BSE Small Cap index fell 0.61%. Both these indices underperformed the Sensex. ' The Sensex has gained 547.03 points or 3.17% in this month so far (till 24 August 2012). The Sensex has jumped 2,328.29 points or 15.06% in calendar 2012 so far (till 24 August 2012). From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 2,647.35 points or 17.49%. From a 52-week high of 18,523.78 on 22 February 2012, the Sensex has lost 740.57 points or 3.99%. Foreign institutional investors (FIIs) bought shares worth Rs 311.78 crore from the secondary equity markets on Thursday, 23 August 2012, as per the provisional data from the stock exchanges. Their inflow into the secondary equity market totaled Rs 5256.90 crore during 14 trading sessions from 1 to 22 August 2012, as per data from Securities & Exchange Board of India. The inflow this month comes on the top of substantial purchases last month. FIIs bought shares worth net Rs 9691 crore from the secondary equity markets in July 2012. Minutes from the US Federal Reserve showed that the central bank's policy committee discussed a third round of quantitative easing (QE3) at its last meeting. Federal Reserve policy makers said after the 31 July 2012 - 1 August 2012 meeting that they will step up record stimulus if needed to spur growth and cut a jobless rate stuck above 8% since February 2009. However, St. Louis Federal Reserve President James Bullard on Thursday, 23 August 2012, said the Federal Open Market Committee minutes released on Wednesday, 22 August 2012, are no longer as relevant because the US economy has picked up in the past month. Bullard said he opposes a new asset-purchase program right now. Federal Reserve Chairman Ben Bernanke, who last month said a third round of bond buying was an option, will update his policy outlook on 31 August 2012 at the Kansas City Federal Reserve Bank's annual symposium in Jackson Hole, Wyoming. Coming back to the domestic market, the stock market was closed on Monday, 20 August 2012 on account of Ramzan Id. Trading for week began on a strong note on Tuesday, 21 August 2012. Key benchmark indices surged on Tuesday, 21 August 2012, as European stocks rose on growing optimism that the European Central Bank (EBC) will take steps to bring down borrowing costs for debt-laden European nations. The BSE Sensex jumped 194.18 points or 1.1% to settle at 17,885.26. The S&P CNX Nifty jumped 54.70 points or 1.02% to 5,421. Key benchmark indices snapped two day winning streak on Wednesday, 22 August 2012, as global shares slipped on Wednesday as investors weighed up whether signs of progress in the euro zone debt crisis warranted the recent surge and as Japan's wider-than-expected trade deficit in July provided a reminder of the problems facing top economies. The BSE Sensex was down 38.40 points or 0.21% to 17,846.86. The S&P CNX Nifty was down 8.15 points or 0.15% to 5,412.85. Key benchmark indices eked out marginal gains in volatile trade on Thursday, 23 August 2012, as world stocks rose amid hope weak Chinese manufacturing data could lead to fresh monetary easing from Beijing. Expectations of a possible further monetary policy easing from the US central bank aided gains on the bourses as minutes from the US Federal Reserve meeting on July 31-Aug. 1 showed that the central bank's policy committee discussed a third round of quantitative easing. US is the world's biggest economy and China is the second biggest. The BSE Sensex advanced 3.38 points or 0.02% to 17,850.22. The S&P CNX Nifty was up 2.50 points or 0.05% to 5,415.35. Key benchmark indices edged lower in choppy trade on Friday, 24 August 2012, as investors grew gloomy about the health of the global economy and after a Federal Reserve official threw cold water on the notion that another round of stimulus from the Federal Reserve is on its way. The BSE Sensex was down 67.01 points or 0.38% to 17,783.21. The S&P CNX Nifty was down 28.65 points or 0.53% to 5,386.70. Among the 30 Sensex shares, 21 rose and the remaining shares declined. State-run Coal India was the top Sensex gainer last week. The stock rose 4.69% to Rs 366.90. The company has proposed in its 2011-12 annual report to be able to buy back shares, which it cannot do under its current Articles of Association. Coal India will seek approval of shareholders at its upcoming annual general meeting (AGM) on 18 September 2012 to amend its Articles of Association in order to facilitate the proposed buyback. "Resolved that pursuant to section 31 and other applicable provisions, if any, of the Companies Act 1956, the Articles of Association of the company be altered to include clause 18A after clause 18 to provide for buyback of shares," the company said in the notice for the resolution to be placed before its shareholders at the AGM. India's second largest software services exporter by revenues Infosys rose 4% to Rs 2,445.35. The company recently said that a US court has thrown out a case filed by an employee alleging harassment for blowing the whistle on how the Indian outsourcing giant flouted US work visa laws. The court found no basis to support any of the charges filed by Jack Palmer, a principal consultant working at Infosys who sued the company, and dismissed the case entirely, Infosys said in a statement. Mr. Palmer was also ordered to pay the costs for the case, the company said, without elaborating. India's largest software services exporter by revenues Tata Consultancy Services (TCS) rose 3.57% to Rs 1,323. The stock hit a record high of Rs 1,328.50 in intraday trade on Friday, 24 August 2012. The company last week said it has entered into a definitive agreement to acquire 100% equity of Computational Research Laboratories (CRL), a wholly owned subsidiary of Tata Sons, for a cash consideration of Rs 188 crore. The acquisition of CRL, a pioneering start-up firm in the arena of High Performance Computing solutions in India, will enable TCS to extend its suite of solutions and offer integrated High Performance Computing (HPC) application and Cloud services to its large base of customers, TCS said in a statement. HPC applications are finding increasing relevance and use among large enterprises, as they look to solve complex business problems like reducing their time-to-market. This is driving an increase in adoption of HPC based applications for modeling, simulations, visualization and big data analysis across the business, TCS said. India's third largest software services exporter by revenues Wipro rose 3.21% to Rs 365. Drug maker Cipla rose 3.40% to Rs 366.90. According to reports, Cipla is partnering South Africa's Aspen Pharmacare to cater to the Australian market. Under the pact, Cipla would develop generic products, to be launched by Aspen in Australia. FMCG major Hindustan Unilever (HUL) rose 3.34% to Rs 518.85. The stock hit a record high of Rs 527.75 in intraday trade on Friday, 24 August 2012. Index heavyweight and cigarette maker ITC rose 1.26% at Rs 265.15. The stock had scaled a record high of Rs 269.25 on 14 August 2012. The company reported strong results last month. ITC's net profit jumped 20.21% to Rs 1602.14 crore on 15.34% growth in net sales to Rs 6652.21 crore in Q1 June 2012 over Q1 June 2011. Despite series of tax hikes, ITC's performance in cigarettes business remains robust and displays pricing power for the company. Car major, Maruti Suzuki India rose 1.12% to Rs 1190.25. The company resumed production at its Manesar facility in Haryana on Tuesday, 21 August 2012. The company had declared a lock-out at the Manesar plant on 21 July 2012 following large scale violence by workmen on 18 July 2012. The re-start of production at the Manesar plant would be gradual and will be taken up in phases, Maruti had said last week at the time of announcing the lifting of lock-out at the unit. Maruti produces its highest-selling diesel cars -- the Swift hatchback and the Swift Dzire sedan -- at its Manesar unit. It also manufactures the SX4 sedan and the A-Star small car at Manesar. India's largest listed telecom company by sales Bharti Airtel was the top loser in the Sensex pack last week. The stock tumbled 5.38% to Rs 248. The stock hit a 52-week low of Rs 243.50 in intraday trade on Thursday, 23 August 2012. Index heavyweight Reliance Industries (RIL) fell 4.05% to Rs 782.10. RIL bought back 3.88 crore shares for about of Rs 2776.78 crore till 7 August 2012 under its ongoing share buyback program. RIL has set maximum buyback price of Rs 870 per share. The company has set aside Rs 10440 crore for share buyback. The buyback program opened on 1 February 2012 and closes on 19 January 2013. RIL chairman Mukesh Ambani said at the company's Annual General Meeting in June 2012 that the company's buyback program represents a highly accretive use of cash by the company and it will supplement earnings growth from operations, for higher EPS (earnings per share), in the near future. Hindalco Industries (down 2.63%), Larsen & Toubro (down 2.17%), Tata Steel (down 1.8%), Jindal Steel & Power (down 1.11%), ICICI Bank (down 0.62%), Mahindra & Mahindra (down 0.6%) and State Bank of India (down 0.08%), edged lower from the Sensex pack.