SNAPSHOT
Stock markets in India plummeted by over one and half a percent for the week ended March 11, after showing potential signs of market reversal in the previous week. The frontline indices witnessed a week filled with tumultuous global events as they got dragged in three out of the five trading sessions. Indian markets made a nervous start to the week as the benchmarks plummeted on Monday after investors took profits off the table on seeing the indices surged about four and half a percentage points in the previous week. Reports of differences between ruling UPA allies, Congress and the DMK over seat haring for the April 13 assembly polls in the Tamil Nadu too undermined sentiments during mid of the week. The political uncertainty though cooled by Wednesday after DMK agreed for a seat sharing formula with the Congress. Equity markets in India swayed through the week on the tune of crude oil prices which have been on a roller-coaster ride off late, sentiments got undermined by the prolonged civil upheaval in Libya which stoked supply concerns. But the last trading of day of the week saw the local markets take a blow of around a percent after yet another disquieting global development surfaced in Japan which was hit by a great earthquake of 8.9 magnitude on Richter scale, fifth largest recorded worldwide.
WEEK GONE BY
The Bombay Stock Exchange (BSE) Sensex tumbled 312.60 points or 1.69% to 18,174.09 during the week ended March 11, 2011. The BSE Mid-cap index decreased 0.95% to 6,592.12 and the Small-cap index shed 1.24% to 7,899.81. Most of the sectoral indices on the BSE were in the negative terrain; CG, Bankex, Power , were the major losers on the index, while Realty up by 26.22 points or 1.26% to 2,103.68 nd Oil and Gas up by 69.75 points or 0.72% to 9719.02. The S&P CNX Nifty decreased 93.30 points or 1.68% to 5,445.45. On the National Stock Exchange (NSE), CNX IT trimmed 1.30% to 6722.25, CNX Nifty Junior shed 1.06% to 10,693.10, CNX Mid-cap declined 0.63 % to 7605.60 and Bank Nifty tumbled 0.61% to 10,740.95. Foreign Institutional Investors (FIIs) were net buyers in the equity segment in the week, leading to a net inflow of Rs 999.5 crore. Food inflation in India has declined for the second successive week in late-February, food price index rose by single digits to 9.52% for the week ended February 26, 2011 as compared to 10.39% seen in the previous week. The decline was largely on the back of ease in prices of vegetables, potatoes and rice. The Index for Industrial Production (IIP) has shown smart recovery in the month of January, coming at better than expected 3.7% after hitting a 20-month low of 1.6% in December.
WEEK AHEAD
In the coming week investor's will be watching out for Wholesale inflation data for the month of February that will be released on Monday, followed by the Reserve Bank of India's mid-quarter review on March 17,2011. Meanwhile, the next big trigger for Indian equity markets after budget will be RBI's monetary policy review, wherein, India's central bank which is struggling with its dual objectives of containing inflation and promoting growth is widely expected to raise interest rates again. Besides, this the companies will report their Advance tax payments on March 15, 2011. Advance tax number will show the health of the Indian companies in the fourth quarter. However, bank woes over tight liquidity conditions is expected to mount post advance tax outflows. On the global front, the investor's will be eying lots of major economic data from the US, starting with employment Situation data due to be released after the Indian market hours on March 11, 2011(Friday), followed by FOMC Meeting Announcement on March 15, 2011, Housing Starts data, Producer Price Index data, Consumer Price Index data, Industrial Production data and finally the Philadelphia Fed Survey data on March 17, 2011. Hence possibility of a range bound scenario between 5200 -5670 could be more justified at this stage however we feel sentiments remain under pressure till 5670 wouldn't be break down with substantial volumes. HAPPY TRADING….
