Markets clocked 1% gains for the week as upbeat earnings by some companies lifted sentiment and Greece bail out news by European Union improved risk appetite for equities.
The Nifty started the week on a positive note and touched a high of 5,645 mid-week. Soon after, the index succumbed to selling pressure as investor sentiment turned sour over Europe and US debt concerns and mixed bag of earnings from Wipro and Hero Honda, which dragged the index to a low of 5,532.
The S&P CNX Nifty reversed all the losses and ended the week on a positive note following Greece bail out news and better than expected results by Axis Bank. The Nifty closed at 5,634, up 93 points and the BSE Benchmark Sensex ended at 18,722, up 286 points. For the week, both the indices were up 0.9% each.
Markets across the globe rallied on Friday, after the European Union took a bold step to give a second bailout, an additional $157 billion and a contribution from private sector bond holders for Greece. The aid package will stop the contagion from spreading to other nations. The Nikkei gained 1.6% for the week, the Hang Seng added 2.6%, but the Shanghai Composite Index finished the week with a 1.8% loss as manufacturing activity slowed.
On Friday evening after markets hours, the cabinet approved India’s biggest foreign investment venture-the Reliance Industries and British Petroleum $7.2 billion deal to purchase 30% stake in the 23 oil & gas blocks owned by RIL. The RIL stock was lacklustre for the most part of the week, but rallied over 1% on Friday, and closed near day’s high at Rs 887. Analysts said that the markets may view this development positively.
While RIL cash on books will get flooded with this venture, analysts said, the stock will break out of the range of Rs 850-950 only if the company increases its output from KG D6 basin. This is a third decision taken by the oil ministerJaipal Reddy since he took office.
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Going forward Reliance Industries results on Monday and the RBI policy on rate hike on Tuesday will set the tone for the markets.
Bharti Airtel was the top gainer for the week, up 4.7% at Rs 411 after it raised tariff prices by 20% on Friday.
Mixed bag of earnings was reported by India Inc last week. HDFC Bank profit surged 37% to Rs 1,085 crore from Rs 812 crore a year ago for the June quarter. However the stock dipped 1.5% for the week and closed at Rs 509. Wipro stock plunged 2% over grim business outlook, although net profit for the first quarter was a tad higher at Rs Rs 1,335 crore, up 1% from a year earlier. Hero Honda dipped 0.6% for the week, although net profit jumped 13% to Rs 558 crore in the June quarter.
On Friday Axis Bank, reported net profit of growth of 27%, at Rs 942 billion rupees for June quarter, better than analysts estimate and stock rallied 2% for the week, at Rs 1296.
BSE IT stocks were the top gainers for the week, up 1.7% on positive news from Europe. Infosys advanced 3.5%, HCL Technologies gained 1.5% and Mphasis surged 3.6%
BSE FMCG index was also the top gainer for week on better than average monsoon, the index was up 1.7%. Godrej Consumers added 3.5%, ITC rallied 3% and Marico gained 2.5%.
BSE Consumer Durables index was the top loser, down 1.7%. Bajaj Electricals fell 11%, Whirlpool was down 8% and Blue Star declined 3.9%.
From the broader markets, BSE Midcap index gained 0.6% and BSE Smallcap index surged 1.2%.
Top gainers on the Sensex were Sterlite, up 3.4%, DLF gained 3.2% and Tata Power also added 3.2%. Prominent losers were Tata Motors, down 3.8%, NTPC fell 3.1% and Reliance Communication declined 2%.