India's benchmark share indices ended nearly 3% up in the week to January 7, the first week of calendar year 2012 , led by banks and capital goods shares. Capital goods shares gained on the back of encouraging manufacturing activity. Bank shares firmed up after easing food inflation and central bank’s focus on economic growth rekindled hopes of rate cut.
The Bombay Stock Exchange’s 30-share Sensex gained 394 points or 2.6% to end at 15,849 in the week under review and National Stock Exchanges’s 50-share S&P CNX Nifty was up 123 points or 2.7% to end at 4,747.
On Monday, benchmark share indices snapped four-day losing streak to end the first trading day of 2012 on a positive note led by index heavyweight Reliance Industries and software shares. The 30-share Sensex ended up 63 points or 0.4% at 15,518 and the 50-share Nifty ended up 12 points or 0.3% at 4,637.
On the macro front, India's November exports rose an annual 3.87% to $22.3 billion , while imports for the month rose 24.55% to $35.9 billion, the government said in a statement on Monday. India's trade deficit in November was at $13.6 billion added the statement.
The government also announced that it would allow qualified foreign investors to invest directly in India equities.
India's manufacturing activity jumped to a six-month high in December thanks to a spike in factory output and new orders from domestic and international firms, a survey of purchasing managers showed on Monday. The HSBC Markit India Manufacturing PMI jumped to 54.2 from 51.0 in November, its biggest monthly rise since April 2009.
Markets extended gains for the second straight day on Tuesday to end over 2% higher led by financial shares on hopes that the Reserve Bank of India would cut interest rates to boost growth.
The 30-share Sensex ended at 15,939, up 421 points or 2.7% and the 50-share Nifty ended at 4,765, up 129 points or 2.8%.
Markets consolidated on Wednesday to end marginally lower, after rising over 3% in the previous two sessions, as investors booked profits ahead of the Oct-Dec earnings, on concerns that earnings would remain muted.
Markets ended mixed amid lacklustre trade on Thursday, easing most of the early gains, as investors booked profits in index heavyweights Reliance Industries and Infosys.
For the first time in at least five-and-a-half years, India witnessed food deflation. Wholesale price-based food inflation fell to –3.36 per cent during the week ended December 24 due to a high base (20.84 per cent a year ago), a number of items witnessing a decline in prices and deceleration in the rate of price rise in others.
Benchmark shares indices ended marginally higher, snapping a 2-day decline, amid a volatile trading session on Friday, led by gains in index heavyweight Reliance Industries, private banks and fast moving consumer goods shares.
Key share indices ended tad lower on Saturday amid lack of investor participation in a special truncated trading session held for upgrade of software by one of the stock exchanges. On Saturday, a special two hour trading session was conducted for the upgrade of Futures & Options system infrastructure of the National Stock Exchange.
The gains during the week were led by capital goods and bank shares. The BSE Bankex was the top gainer during the week under review up 6.4%. It may be recalled that the sectoral index ended down nearly 4% last week. Top gainers include ICICI Bank up 9%, HDFC Bank gained 6% and Axis Bank ended 5.5% higher.
The BSE Capital Goods index ended up 5.9%. Top gainers in the index include, L&T up nearly 9% and BHEL rose 4.6%. Index heavyweight Reliance Industries ended up 3% during the week.
The broader market also ended higher in line with the benchmarks with the BSE Mid-cap gaining 3.1% and Small-cap index rising 3.7%.
In the BSE mid-cap segment, public sector units (PSUs) rose sharply after market regulator SEBI recently cleared regulatory changes to allow PSU buybacks. National Fertiliser rose 45%, RCF surged 38%, HMT gained 33%. Among other shares Arvind, Balrampur Chini, Delta Corp and Fortis Health gained over 10% each.
In the BSE small-cap segment, public sector companies such as Andrew Yule and Dredging Corporation gained 33% and 25%, respectively, while State Trading Corporation galloped 50%.