Enthused by excellent corporate results, lower-than-expected inflation figures and positive news flow from the government, stocks turned in spectacular performances last week. | |
| The government announced its divestment plans and directed non-government pension funds to invest upto 5 per cent in equities, injecting fresh optimism in equities. |
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| Sentiment was upbeat across the board but mid-caps displayed more strength. Infosys, HLL, Tata Steel, Ranbaxy and SBI were the top five contributors to the Sensex's gains. HDFC, Hero Honda and Zee were drags though the losses were only marginal. |
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| FII buying was strong during the first three days of the week. Volumes also rose steadily. The daily average turnover on NSE and BSE was up 15 per cent from month-ago levels. |
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| All sectoral indices recorded gains with metal stocks leading the pack. Good quarterly numbers in metal scrips like SAIL, Tata Steel - both recorded over 90 per cent growth in bottomline - drove stock prices up 11 per cent and 9 per cent respectively. |
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| Two-wheeler stocks Bajaj Auto and Hero Honda were weak while Maruti and M&M were among the biggest gainers. Larsen & Toubro was subdued due to a slowdown in order-booking while oil stocks seemed nervous after HPCL announced a 70 per cent decline in bottomline. |
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| The American markets remained flat on jitters ahead on Iraqi elections on Sunday. Besides, lower-than-expected GDP growth and some earnings disappointments took their toll on the stocks. Brent crude has been steadily rising in the past few weeks. |
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But on Friday oil prices tumbled as a result of speculations that Opec could keep supplies unchanged at its week-end meeting despite growing pile of inventories in the US.
| | 28-Jan-05 | Return (%) | | 1 week | 1 month | 1 year | | BSE Sensex | 6419.00 | 3.81 | -2.20 | 9.24 | | S&P CNX Nifty | 2008.30 | 4.31 | -3.04 | 7.79 | | BSE-100 | 3452.16 | 3.84 | -3.08 | 12.89 | | BSE-200 | 850.45 | 4.07 | -3.53 | 12.07 | | BSE-500 | 2670.73 | 3.98 | -3.33 | 14.54 | | CNX Midcap 200 | 2565.95 | 4.04 | 0.04 | 49.19 | | CNX Nifty Junior | 4200.70 | 2.46 | -5.37 | 19.73 | | S&P CNX 500 | 1732.70 | 3.86 | -3.42 | 14.78 | | FII Net inflows* | 198.80 | -453.70 | 176.60 | 35287.20 | | MF Net inflows* | -21.97 | 139.02 | 687.10 | -836.92 | | BSE Turnover (Rs cr)@ | 2528.34 | 2258.94 | 2313.26 | 3414.85 | | NSE Turnover(Rs cr)@ | 5709.72 | 5065.19 | 4870.30 | 7078.90 | | Sensex P/E (x)@ | 16.03 | 15.65 | 16.98 | 19.04 | | | | BSE-Auto | 2762.26 | 4.63 | -2.65 | 9.42 | | BSE-Bankex | 3562.91 | 3.94 | -2.58 | 21.02 | | BSE-Cap. Goods | 2902.97 | 3.18 | -3.37 | 26.50 | | BSE-Cons Durable | 1423.76 | 4.14 | -6.00 | 14.34 | | BSE-FMCG | 1117.17 | 4.02 | 5.15 | 4.41 | | BSE-Healthcare | 2675.54 | 4.19 | -11.45 | 12.49 | | BSE-IT Sector | 2530.22 | 4.34 | -2.75 | 28.02 | | BSE-TECk | 1673.57 | 4.39 | -2.98 | 31.05 | | CNX IT | 2806.25 | 3.84 | -4.28 | 25.33 | | BSE-Metal | 5995.65 | 7.29 | -3.30 | 21.04 | | BSE-Oil & Gas | 2989.82 | 2.52 | -5.01 | -4.02 | | BSE-PSU | 4135.29 | 3.90 | -5.86 | 7.39 | | | | Nasdaq | 2047.15 | 0.06 | -5.97 | -1.45 | | Dow Jones | 10467.40 | -0.04 | -3.57 | -0.01 | | MSCI World | 1133.40 | 0.21 | -2.94 | 6.79 | | MSCI Emerging Markets | 535.70 | 2.17 | 0.24 | 14.26 | | MSCI Emerging Asia | 232.58 | 1.18 | 2.28 | 5.47 | | $/Rs | 43.72 | -0.21 | 0.07 | -3.57 | | Brent Crude (spot) $/Bbl | 45.57 | 2.38 | 15.16 | 48.53 | | * Figures for week, month and year are cumulative flows. @ Daily average turnover/Sensex P/E as on date, week-ago, month-ago and year-ago. |
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| What to expect this week? |
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| Some important corporate results are pending. The government's directive to allow non-government pension funds to invest in equities is seen by market experts as a precursor to announcements on pension and provident fund investments in equity markets in the Budget. A pre-Budget rally seems to have begun. |
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Technical analysts are setting their eyes on Sensex 6500. Watch out for the following:
- Quarterly numbers from auto major Tata Motors, oil companies ONGC and BPCL are due on monday.
- Official statements are likely from Procter & Gamble (India), following the announcement by P&G to buy out Gillette in an all-stock deal last week.
Stock of the week
| Dabur India | | Last week's close (Rs) | 97.58 | | Prev. week's close (Rs) | 88.10 | | Last week's ave. daily turnover (Rs cr) | 17.92 | | Prev. week's ave. daily turnover (Rs cr) | 4.79 |
Dabur India made big news last week with the acquisition of Balsara in a Rs 173-crore deal. Balsara's consumer household and oral-care brands such as Babool, Promise, Odomos and Odonil will strengthen Dabur's product line, enhancing its growth prospects. The company also announced good third-quarter numbers with sales growing 9 per cent and net profit up 44 per cent. The stock gained 10 per cent last week on renewed buying interest. Domestic research firm SSKI re-iterated its Outperformer rating in the stock last week. At the current price of Rs 98, the stock quotes at 15.9x FY06E earnings. The stock saw an upward break-out last week with substantial rise in volumes. It should see definite appreciation if the market remains positive. Rs 93 is a critical support level. Unless the stock ends below this level for two consecutive sessions, it should see a near-term target of Rs 115, according to technical analyst Hemen Kapadia. |
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