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Weekly-market: Big-Bang Pre Budget Week; Indices at all time high
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Saturday, July 5, 2014 |
| | | Market Commentary | | | Big-Bang Pre Budget Week; Indices at all time high | | India's stock markets recorded fresh peak on growth expectations in the upcoming budget. The S&P BSE Sensex rose 3.43% and Nifty gained 3.23% for the week ended July 04, 2014 | |
 Major Headlines for the week:
Indian indices:
Welcome to the 'Weekly Market Wrap' for July 04, 2014 where key benchmark indices edged higher in the week ended Friday, 4 July 2014. Expectations of a growth oriented Budget and decline in crude oil prices triggered gains on the bourses. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both hit record high.
The market logged gains in four out of five trading sessions in the week just gone by. The BSE Mid-Cap and the BSE Small-Cap indices outperformed the Sensex during the week.
Expectations of a growth oriented Budget supported gains on the bourses during the week. Increase in outlay on infrastructure sector with focus on stricter and time-bound implementation of projects, initiatives towards investments in agriculture and irrigation aimed at easing supply bottlenecks for food-grains, fiscal prudence with roadmap to reduce the fiscal deficit, a roadmap for reducing the subsidy burden and timeline for implementation of the Goods and Service Tax are some of the expectations from the Budget. Finance Minister Arun Jaitley will table the final Union Budget for 2014-15 in parliament on 10 July 2014.
Jaitley reportedly said on Tuesday, 1 July 2014, that the government would take bold decisions and pursue the path of fiscal prudence to revive the economy.
Concerns about India's macroeconomic situation have eased as crude prices have come off 9-month high which it hit last month. India imports about 80% of its crude oil requirement. Brent crude oil futures for August delivery were trading 19 cents lower at $110.81 a barrel on Friday, 4 July 2014.
In the week ended Friday, 4 July 2014, the 30-share S&P BSE Sensex gained 862.14 points or 3.43% to 25,962.06, a record closing high for the index. The barometer index had scaled a record high of 25,999.08 in intraday trade on Thursday, 3 July 2014.
The 50-unit CNX Nifty advanced 242.80 points or 3.23% to 7,751.60, a record closing high for the index. The index hit record high of 7,758 in intraday trade on Friday, 4 July 2014.
The S&P BSE Mid-Cap index gained 340.75 points or 3.7% to 9,545.75. The S&P BSE Small-Cap index advanced 485.74 points or 4.84% to 10,508.03. Both these indices outperformed the Sensex.
Weekly market trend from June 30 - July 04:
June 30- Indian shares rose on Monday as investors bought shares in recent outperformers such as State Bank of India, allowing the broader index to post its best quarterly gain since January-March 2012. The BSE Sensex rose 1.25% and NSE Nifty gained 1.37% for the day. The Sensex closed at 25413.78, up by 313.86 points, while the Nifty rose 102.55 points to close at 7611.35 July 01- Indian shares rose for a third straight session on Tuesday and were not far from a record high hit last month as automakers such as Maruti Suzuki India Ltd surged after stronger monthly sales, while strong foreign buying also underpinned sentiment. The BSE Sensex rose 0.40% and NSE Nifty gained 0.31% for the day. The Sensex closed at 25516.35, up by 102.57 points, while the Nifty rose 23.35 points to close at 7634.70 July 02- Indian shares surged more than 1 percent to hit record highs on Wednesday after Finance Minister Arun Jaitley's warning against "mindless populism" raised hopes the government would unveil a fiscally prudent budget next week. The BSE Sensex rose 1.27% and NSE Nifty gained 1.18% for the day. The Sensex closed at 25841.21, up by 324.86 points, while the Nifty rose 90.45 points to close at 7725.15 July 03- Indian shares fell slightly on Thursday, retreating from record highs earlier in the session, as investors snapped a powerful four-day rally by booking profits in recent outperformers such as Hindalco Industries. The BSE Sensex fell 0.07% and NSE Nifty slipped 0.13% for the day. The Sensex closed at 25823.75, down by 17.46 points, while the Nifty fell 10.35 points to close at 7714.80  July 04- India's NSE index hit a record high on Friday as bluechips rose on optimism that Prime Minister Narendra Modi will deliver a fiscally prudent budget next week. The BSE Sensex rose 0.54% and NSE Nifty gained 0.48% for the day. The Sensex closed at 25962.06, up by 138.31 points, while the Nifty rose 36.80 points to close at 7751.60
Global indices:
Gainers: Nikkei up 2.27%, Nasdaq up 2.00% and DAX100 up 1.98%.
 Sectoral and stock screening:
Topmost Gainers: S&P BSE Auto up 5.91%, S&P BSE Power up 5.18% and S&P BSE HC up 4.97%.
| | Looking at the 'A' group stocks, the top three gainers of the week were - CESC up 22.04%, Adani Ports up 17.28%, Motherson Sumi Systems up 16.74%. Top three losers of the week were - Sobha Developers fell by 7.14%, United Spirits fell by 4.85% and TV 18 Broadcast down 4.80%. FII/MF activity
The foreign institutional investors (FIIs) have been the net buyers of the Indian stocks to the tune of Rs4252.14 crore and the domestic investors sold Indian shares worth a net of Rs83.60 crore as on July 03, 2014. | | TOP MOVERS (GROUP A) |  | | | | | | | | | | Adani Ports & Special Economic Zone | 275.15 | 17.28 | | | Motherson Sumi Systems | 369.60 | 16.74 | | | | | Sobha Developers | 490.6 | -7.14 | | | United Spirits | 2453.35 | -4.85 | | | TV 18 Broadcast | 31.70 | -4.80 | | | | | | | FII/MF ACTIVITIES | | | | | | | Gross purchase | 30,942 | 3,159 | | | | | | | | | | | | Data as on July 03, 2014
| | | | Market Outlook for the coming week!
In the coming week, Union Budget for 2014-15 is a major event. The week also marks the beginning of the Q1 June 2014 corporate earnings season. The Budget session of the Parliament will start on Monday, 7 July 2014.
Finance Minister Arun Jaitley will present the final Union Budget for 2014-15 in Lok Sabha at 11:00 IST on Thursday, 10 July 2014. A day before that i.e. on Wednesday, 9 July 2014, the Finance Ministry will table Economic Survey for 2013-14.
Railway Minister Sadananda Gowda will present the final Railway Budget for 2014-15 in Lok Sabha on Tuesday, 8 July 2014. Investors will continue to watch the progress of the monsoon rains amid concerns that poor rains this year will send food prices higher.
Expectations that the finance minster will announce measures in the Budget aimed at bolstering economic growth may keep stock prices firm ahead of the Budget announcement on 10 July 2014. The finance minister will have to do a balancing act of containing fiscal deficit, controlling inflation and also promoting growth. Increase in outlay on infrastructure sector with focus on stricter and time-bound implementation of projects, initiatives towards investments in agriculture and irrigation aimed at easing supply bottlenecks for food-grains, fiscal prudence with roadmap to reduce the fiscal deficit, a roadmap for reducing the subsidy burden and timeline for implementation of the Goods and Service Tax are some of the expectations from the Budget.
Shares of public sector undertakings (PSUs) will be in focus amid expectations that the government will raise the target on proceeds from PSU divestment in the final Union Budget for 2014-15 to boost the government's non-tax revenue.
Shares of infrastructure developers and cement companies will be in focus on expectations of higher allocations for power, roads, ports, rivers, railways etc. in the final Union Budget 2014-15 to be unveiled on 10 July 2014. The Finance Minister is likely to provide a thrust on time bound implementation of various infrastructure projects.
With respect to the real estate sector, there are expectations that the government will take steps towards providing the long awaited industry status to the real estate sector and provide boost to low cost housing in the Budget. Industry status will help easier access to bank lending for real estate developers. There are also expectations that the tax benefit with respect to interest payment on housing loans will be raised. At present, a maximum deduction of Rs 1.5 lakh is allowed on taxable income towards interest on housing loan.
The power sector is expecting extension of tax benefits under section 80IA of the Income Tax Act in the Budget. The law allows a producer to claim tax exemption for up to 10 years within the first 15 years of a project's operations. The tax benefit was earlier extended for a year until 31 March 2014.
Shares of jewellery retailers will be in focus as some moderation in gold import duty is expected in the Budget. The All India Gems and Jewellery Trade Federation (GJF) in its wish list for the upcoming Budget, has asked the Finance Minister to abolish 80:20 rule for gold import and cut in import duty on gold to 2% from 10%.
ITC will be in focus on speculation the government will increase excise duty on cigarettes in the Budget including on cigarettes of stick size of less than 65 mm in length which currently enjoys lower excise duty.
First quarter corporate earnings season begins next week. Private sector bank IndusInd Bank will unveil Q1 results on Wednesday, 9 July 2014. IT major Infosys is scheduled to announced Q1 results on Friday, 11 July 2014.
The government will unveil industrial production data for May 2014 on Friday, 11 July 2014.
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posted by Anonymous @ 4:12 AM  |
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