ShareKhan Newsletter Blog

 Market Commentary 

Sensex, Nifty slip 1% in second week of 2013

The Indian markets ended in the red zone breaking the gaining trend of last two-weeks. The Sensex ended the week getting a hit of 0.60% while the Nifty fell 1.07%.

Major Headlines for the week:

• IIP for November at -0.1% beats estimates
• December car sales fall 12.5% 
• India's GDP forecast reduced to 5.2% for FY13: HSBC 
• Forex reserves up by $39.4 m to $296.58 bn
• Dec trade deficit at $17.7 bn vs $14.7 bn last year 
• Infosys beats estimates; FY13 Guidance up 

Indian indices

Welcome to the 'Weekly Market Wrap' for the week ended January 11, 2013

After seeing a smart rally in the previous two-weeks, the key indices wrapped up the week ended January 11, 2013 in red. Volatility ruled the markets this week on account of major events such as November IIP numbers, HSBC manufacturing, Domestic Car Sales and results of blue-chip companies like Infosys. Markets ended in red in four out of five trading sessions owing to selling pressure all across the board. Foreign institutional investors (FIIs) remained buyers of Indian stocks during the week. The BSE Mid-Cap index fell 2.15% and the BSE Small-Cap index declined 2.11%. Both these indices underperformed the Sensex.

Adding further, Railway Minister announced hike in fares from January 21 which hinted that there will be no increase in fares in February rail budget.

The BSE Sensex fell 120.44 points or 0.60% to 19,663.64 while the NSE Nifty fell 64.85 points or 1.07% to settle at 5,951.30 for the week ended January 11, 2013.

Major events of the week:

• The index for industrial production for November came in at -0.1% as announced by the government today. It was 8.2% in October and has been revised to 8.3%.

• Domestic car sales fell by 12.51% to 1,41,083 units in December last year compared to 1,61,247 units in the same month in 2011.

• HSBC cut its GDP forecast for the year ending in March to 5.2% from 5.7%, and its forecast for the next fiscal year to 6.2% from 6.9%, according to a report released on today (January 10, 2013).

• India's trade deficit narrowed to $17.7 billion in December from $19.3 billion in November, even after exports fell for the eighth straight month, a trade ministry official said on Friday (January 11, 2013).

Weekly market trend from January 07 - January 11, 2013:

• On January 07, 2013, the key indices opened higher on hopes of global growth recovery in US after better-than-expected economic data. Investors were also cautious ahead of Q3 results to be announced in this week. A weak trend across Asian and European markets dampened the sentiments on Indian bourses. The Sensex closed at 19691.42, down by 92.66 points and the Nifty fell 27.75 points to settle at 5988.40.

• On January 08, 2013, the Indian markets moved in a narrow range and ended with minute gains. The rise in the market was led by gains in defensive shares including index heavyweight ITC and as State Bank of India rose after BofA Merrill upgraded the stock. The Sensex closed at 19742.52, up by 51.10 points and the Nifty rose 13.30 points to settle at 6001.70.

• On January 09, 2013, the indices resumed the trading session on a positive note but could not sustain morning gains till the end. The profit booking in index heavyweights led the markets end lower. The Sensex closed at 19666.59, down by 75.93 points and the Nifty fell by 30.20 points to settle at 5971.50.

• On January 10, 2013, the Indian equity benchmarks surrendered to profit-booking and gave up all of it morning gains in afternoon trade. The morning rally was on the back of the government's decision to hike railway fares and also due to the buying in OMCs on hopes of fuel price hike. The Sensex closed at 19663.55, down by 3.04 points and the Nifty fell by 2.85 points to settle at 5968.65.

• On January 11, 2013, domestic markets started the session in the green zone as sentiments got boosted after Infosys declared better-than expectated Q3 results but this gains were for the short span as the investors were cautious ahead of December inflation data. Poor IIP nos and December trade deficit also added pressure. The Sensex closed at 19639.34, down by 24.21 points and the Nifty fell by 17.35 points to settle at 5951.30.

Global indices
All the global markets closed mixed. Top gainers: Nikkei up by 1.06%, Nasdaq surged by 0.65% and Dow Jones rose by 0.27%. On the other side, top losers were Shanghai Composite down by 1.49%, DAX100 fell by 0.87% and CAC40 slipped by 0.72%. 

Sectoral and stock screening
All the sectors closed the week on a negative note baring BSE IT which was up by 7.82%, BSE TECk was up by 5.63% and BSE Auto rose 0.36%. BSE CG fell by 5.01%, followed by CD which down by 4.23%, FMCG declined by 3.72% and Power slipped by 3.19%.

Looking at the 'A' group stocks, the top three gainers of the week were - Infosys up by 15.51%, Satyam Computers Services up by 6.42% and Unitech up by 6.41%. The top three losers of the week were - United Breweries fell by 12.61%, Oberoi Realty fell by 9.64% and Ambuja Cements fell by 9.45%. 

FII/MF activity
The foreign institutional investors (FIIs) have been net buyer of the Indian stocks worth a net of Rs2759.6 crore, while the domestic investors were net sellers of Indian stocks to the tune of Rs626.5 crore during the week till January 09, 2013.