Equity Research Weekly Market Outlook Report By Mansukh 30th-April-2011

SNAPSHOT

Local Bourses prolonged their losses for the fifth straight session lacking support at higher levels, thereby snapping the week with loss of over 2%. Persistent selling pressure in view of sustained capital outflows by foreign institutional investors coupled with selling across the global equities led to the damage at Dalal Street. The 50 scrip index'Nifty --on National Stock Exchange plunged in trade thereby marking sluggish start for the new F&O expiry series on Friday as investors braced for a hawkish statement from the Reserve Bank when it releases its policy on Tuesday. Financials led the decline with the market expecting the Reserve Bank of India (RBI) to raise key short-term rates by at least 25 basis points to rein in high inflation. It would be the ninth increase since mid-March last year. India VIX, a gauge for market's short term expectation of volatility lost 6.40% at 19.58 from its previous close of 20.92 on Thursday. The S&P CNX Nifty lost 34.50 points or 0.60% to settle at 5,750.95. The index touched high and low of 5,804.30 and 5,706.05, respectively. 24 stocks advanced against 26 declining ones on the index.

WEEK GONE BY

Indian equity indices went through a turbulent week as they failed to negotiate a close above the neutral line for even a single session and eventually snapped the week with a cut of over two percent. The week largely remained characterized by choppiness because investors were reluctant to pile up positions and indulged largely in stock specific activities as

corporate India continued to divulge their fourth quarterly report card. Volatility gradually accelerated session after session as the April series Futures and Options settlement neared while quarterly earnings' announcements by RIL, Wipro, Bank of Baroda, Ambuja Cement, Crompton Greaves, TVS Motors were punished badly as they remained below Street's expectations. On one hand spiraling international crude oil prices become the headache of policymakers while on the other, worries over global economic recovery loomed large, given the fact that world's biggest economy continues to grow at a tepid pace. Updates from the 2G case trial kept hitting headlines through the week thereby weighing down sentiments and prompting investors to book profits in scam linked shares like RCom, Unitech and DB Realty. The April series F&O settlement day turned out to be another pathetic trading session for the Indian stock markets as the selling pressure gathered greater momentum after government released the disappointing food inflation numbers which stayed absolutely flat at 8.76% on annual basis during week-ended April 16 compared with 8.74% recorded in the previous week.

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Equity Research Weekly Market Outlook Report By Mansukh 26-March-2011

SNAPSHOT

Despite starting the week with a lackadaisical performance and ending below the crucial support levels of 5,400 and 18,000, the benchmarks convalesced on Tuesday and carried forward the strong rally for rest of the of the week as they vivaciously conquered a lot of psychological levels on their way up. The consolidation in crude prices around $105 levels despite escalating turbulences in the Middle East nations was also seen as an opportunity by the local investors who resorted to broad based buying as tabling of the banking sector amendment bill and the Constitution Amendment Bill in parliament buttressed the chances of a rebound for the domestic indices. Moreover, bourses rallied over two percentage points on the last trading day of the week to finish the action-packed week on an exciting note. The spurt on the last trading day in benchmarks was not only due to sanguine leads from the global market but also on encouraging local cues like the overall growth  in the farm sector being pegged at 5.4% along with finance minister's avowal of 9% growth in the next fiscal in the upper house of Parliament stoking investor sentiments. 

Boisterous Indian stock markets witnessed an awe-inspiring week of trade as it seemed like the bullishness of the recent past has come to the fore. The frontline indices accumulated over a gargantuan five percentage points for the week taking the benchmarks to around two month high levels as optimistic global cues coupled with encouraging local developments fortified investors' mood. The Bombay Stock Exchange (BSE) Sensex surged 936.83 points or 5.24% to 18,815.64 during the week ended March 25, 2011.The BSE Mid-cap index gained 3.25% to 6,721.56 and the Small-cap index advanced 2.61% to 8,001.63. All the sectoral indices on the BSE were in the positive terrain; Realty was up 184.64 points or 8.99% to 2,237.87, Bankex up by 741.78 points or 6.09% to 12926.07, IT up 344.65 points or 5.74% to 6,344.62, TECk up by 198.55 points or 5.62% to 3729.29 and Capital Goods (CG) up by 646.72 points or 5.23% to 12,373.27 were the major gainer. The S&P CNX Nifty zoomed 280.55 points or 5.22% to 5,654.25. On the National Stock Exchange (NSE), Bank Nifty surged 6.27% to 11,387.30, CNX IT soared 5.77% to 6,930.65, CNX Nifty Junior advanced 3.08% to 10,943.10 and CNX mid- cap gained 3.05% to 7,824.15. 

WEEK AHEAD
Amidst rising crude oil prices would continue to be threat for the equity markets in the coming week which is characterized by the volatility of  the expiry of F&O series for the month of March, Investor's in the coming week will be eagerly eyeing the core sector growth data, as measured
by the index of six key infrastructure industries, having a combined weight of 26.7% in the Index of Industrial Production (IIP) and also the HSBC India Manufacturing PMI data for the month of March. Further, investor's will keep a close watch on telecom stocks as recommendations on the proposed new policies for telecom infrastructure and manufacturing will be coming in the next week. On the global front, investor's will be eyeing lots of major economic data from the US, starting with Existing Home Sales data on March 21,2011, New Home Sales data, Durable Goods Orders and Jobless Claims data and finally the Corporate Profits data.  Therefore any closing above 5670-5690 for at least two consecutive days may reap indices towards 5800-5850 where we might see some sort of consolidation. On the flip side 5355 still a major support for the March series. HAPPY TRADING…..