 "Weekly: Markets falter on global growth concerns, oil prices woes")
Markets showed no signs of respite, as they trended lower through the week, amid a drastic fall in the rupee, sell-off in Chinese shares and decline in crude oil prices. The market logged declines in four out of five trading sessions in the week.
In the week to December 12, the 30-share Sensex ended 3.89 per cent lower, or 1,107.42 points at 27,351, while the 50-share Nifty ended down 3.68 per cent or 314.20 points at 8,224.
Following the duo’s slide, the BSE Mid-Cap Index slumped 389.69 points or 3.71 per cent to end at 10,108.60 and the BSE Small-Cap Index shed 406.21 points or 3.54 per cent to close at 11,068.48.
Foreign institutional investors were net buyers in Indian equities worth Rs 3,084 crore for the week, as per provisional stock exchange data.
Key events that shaped the week
A sharp rise in gold imports and a fall in export growth pushed India's current account deficit (CAD) to 2.1 per cent of gross domestic product (GDP) in the financial year’s second quarter, ending September, compared to 1.2 per cent of GDP for July-September 2013.
China’s economy slowed in November as factory shutdowns exacerbated weaker demand, raising pressure on the central bank to add further stimulus.
The rupee posted its biggest weekly fall in over four months on Friday, tracking the steep decline in local shares and broad dollar strength as the drop in crude oil prices raised concerns about the global economy.
Brent crude slipped to $62 a barrel and earlier hit a low of $61.35-the lowest since July 22, 2009 on concerns over the double whammy of a global supply glut and weak demand.
Stocks
The BSE Oil & Gas Index was the top loser among the sectoral indices during the week down 7.2 per cent followed by oil & gas, realty, metal, power and IT indices.
Oil and gas shares reeled under pressure after global crude oil prices fell to a five-year-low on concerns about supply glut. Oil and Natural Gas Corporation (ONGC) , Reliance Industries (RIL) and GAIL shed between 7-10 per cent.In the week to December 12, the 30-share Sensex ended 3.89 per cent lower, or 1,107.42 points at 27,351, while the 50-share Nifty ended down 3.68 per cent or 314.20 points at 8,224.
Following the duo’s slide, the BSE Mid-Cap Index slumped 389.69 points or 3.71 per cent to end at 10,108.60 and the BSE Small-Cap Index shed 406.21 points or 3.54 per cent to close at 11,068.48.
Foreign institutional investors were net buyers in Indian equities worth Rs 3,084 crore for the week, as per provisional stock exchange data.
Key events that shaped the week
A sharp rise in gold imports and a fall in export growth pushed India's current account deficit (CAD) to 2.1 per cent of gross domestic product (GDP) in the financial year’s second quarter, ending September, compared to 1.2 per cent of GDP for July-September 2013.
China’s economy slowed in November as factory shutdowns exacerbated weaker demand, raising pressure on the central bank to add further stimulus.
The rupee posted its biggest weekly fall in over four months on Friday, tracking the steep decline in local shares and broad dollar strength as the drop in crude oil prices raised concerns about the global economy.
Brent crude slipped to $62 a barrel and earlier hit a low of $61.35-the lowest since July 22, 2009 on concerns over the double whammy of a global supply glut and weak demand.
Stocks
The BSE Oil & Gas Index was the top loser among the sectoral indices during the week down 7.2 per cent followed by oil & gas, realty, metal, power and IT indices.
Shares of metal companies fell up to 13 per cent on China slowdown fears. Sesa Sterlite, Tata Steel and Hindalco lost between 6-13 per cent.
IT major Infosys lost 6.31 per cent after company's founders N R Narayana Murthy, Nandan Nilekani, K Dinesh and S D Shibulal, along with their families sold a total 3.26 crore shares of the company in bulk deals on the NSE.
Wipro fell 5.98 per cent after Wipro Inc Benefit Trust sold 18.10 lakh shares of Wipro during at an average market price of Rs 552.43 per share.
TCS, India’s largest information technology services player, is learnt to be undergoing a restructuring exercise and was down 4.76 per cent at the end of the week.
Financials declined across the exchange. ICICI Bank, Axis Bank, State Bank of India and the HDFC twins declined between one and four per cent.
On the flip side, Coal India ended up 2.5 per cent after it requested the government to re-allot the two coal blocks in Odisha, which it had lost following the Supreme Court’s order to cancel allocation of 214 coal blocks.
Sun Pharma gained 2.5 per cent after CCI approved the proposed merger between Sun Pharma and Ranbaxy, which will result in a combined entity with annual sales worth $4.3 billion, making it the fifth-largest generic drug maker globally.
ITC gained one per cent and has become the second-most valuable Indian company, surpassing refineries giants ONGC and RIL in overall m-cap ranking.
Week ahead
Wholesale Price Index (WPI) inflation data for November, the third instalment of corporate advance tax due December 15 and developments in the winter session of Parliament will be in focus.
Outcome of the FOMC monetary policy review, snap election in Japan and Greece’s presidential elections, the movement of rupee against the dollar, and crude oil price movement will dictate near term trend on the bourses.
Further, markets will react to the weak October industrial production, which contracted 4.2 per cent despite the festive season.