Markets end weekly trade flat, RBI policy next trigger (Weekly Review)

Mumbai, Jan 31 (IANS) Major Indian equities indices ended flat in the weekly trade which closed Jan 30, as sentiments were bearish on sector specific movements based on related earnings.

According to market observers, the wide movement in the Indian equities markets was led by respective stocks which led to high volatility. However the broad indices rallied and touched new record highs due to funds being pumped in by the foreign investors.
“The markets reacted to sector specific stocks on related earnings in the previous week’s trade,” Devendra Nevgi, chief executive, ZyFin Advisors told IANS.
The benchmark 30-scrip Sensitive Index (Sensex) of the S&P Bombay Stock Exchange (BSE)
was down 95.89 points or 0.32 percent in the weekly trade ended Jan 30.
The barometer index closed at 29,182.95 points, while it had ended trade at 29,278.84 points on Jan 23.
In the weekly trade ended Jan 23 the S&P BSE Sensex had gained 1,156.95 points or 4.11 percent. It had closed the week ended Jan 23 at 29,278.84 points, while it had ended trade at 28,121.89 points on Jan 16.
The Indian markets resumed trade on Tuesday (Jan 27) after remaining shut Jan 26 on account of Republic Day. It touched three new record intra-day highs in the weekly trade ended Jan 30.
“Markets in an overdrive mode. We are hitting a new high almost every second day,” said Gaurang H.Shah, vice president, Geojit BNP Paribas Financial Services.
“The impact of the visit of US President Obama is now being factored in by the markets and what remains to be seen is how the government is going to take it forward on policy changes and implementation.”
Shah added: “The earnings season has been a mixed bag so far and in our view it will remain like this for some time though we have had some selective upgrades come in sectors which have delivered better then expected third quarter numbers.”
However, on Friday the S&P BSE Sensex closed 499 points or 1.68 percent down on sector specific movement in banking, automobile and consumer durables stocks.
“Markets fell on the last day of the week largely on the back of worse-than-expected asset quality numbers declared by banks – both public and private,” said Kamlesh Rao, chief executive, Kotak Securities.
On the global front US Fed retained its stand on the rate cut in 2015 and the outcome of the Greek election reinforced confidence of a stable government. Both the events were positive for the Indian markets.
The strong positive traction in the Indian markets attracted foreign investors in the week under review. The foreign institutional investors (FIIs) remained net buyers in the capital market segment.
For the week ended Jan 30, the FPIs massively bought stocks in equity markets worth Rs.6,926.89 crore or $1.12 billion, according to data with the National Securities Depository Limited (NSDL).
The FPIs had picked up stocks worth Rs.5,748.07 crore or $930.99 million in the previous week ended Jan 23.
The major Sensex gainers on Jan 30 were: Tata Power, up 2.90 percent at Rs.90.55; BHEL, up 1.62 percent at Rs.291.80; NTPC, up 1.37 percent at Rs.143.80; Wipro, up 0.79 percent at Rs.606.30; and Sesa Sterlite, up 0.67 percent at Rs.201.75.
The losers were State Bank of India (SBI), down 5.13 percent at Rs.310; ICICI Bank, down 4.95 percent at Rs.361.15; Dr Reddy’s Lab, down 3.91 percent at Rs.3,228; Coal India, down 3.81 percent at Rs.360.85; and HDFC, down 3.35 percent at Rs.1,265.65.
Market insiders point out that the next major trigger for the market will be the Reserve Bank of India’s (RBI) monetary policy review slated for Feb 3, the ongoing earnings season and global events like crude oil price movement.
“The next big events to watch out will be the RBI’s monetary policy announcement, budgetary expectations and the ongoing earnings results,” Nevgi added.