Psychological levels were surpassed last week, with the crude oil breaking the strong support of $120, which helped the Sensex close above the crucial 15,000 mark. Notably, the barometer index rose in all the five trading sessions during the week.
Improvement in rainfall, return of foreign institutional investor (FII), high direct tax collections and apparent tapering of inflation (12.01 per cent) further enthused the markets, with the Sensex gaining 511 points (3.49 per cent) to 15,167 and Nifty rising 116 points (2.62 per cent) to 4,529. Beaten down mid-cap stocks were back in focus with the BSE Mid-Cap adding 244 points (4.33 per cent) to 5,887.
What to expect this week
The market will closely track the June index of industrial production (IIP) numbers to be released on Tuesday along with Sebi’s meeting on Wednesday to review FII regulations, for future direction.
Analysts expect the markets to continue the upmove on the back of strong global cues, unless some negative news emerges out of the above mentioned events.
Industrial production grew at the slowest pace in more than six years in May 2008, at 3.8 per cent, as against 10.6 per cent in the same month in2007, with manufacturing showing signs of acute deceleration.
In the upcoming meet, Sebi may review rules relating to the issuance of participatory notes and the securities lending and borrowing mechanism.
Stock to watch
Sterlite Industries India, a part of UK's Vedanta Resources, is expected to attract attention on the bourses in the coming days as the Supreme Court has given the company the go ahead for bauxite mining in Lanjigarh, Orissa last Friday. Vedanta wants to dig open cast mines in the Niyamgiri hills in Orissa to feed an alumina refinery it has already built in the area, as part of an $800 million project. | ||||||||||||||||
Reports suggest that the company intends to produce one million metric tonne annually from the refinery and the mining is likely to begin in the next 3-6 months.
Amid protests that the project will severely damage the ecology of the region, the Supreme Court temporarily barred Vedanta in November last year from mining bauxite in the Niyamgiri hills. The apex court has now asked Vedanta to invest at least $2.5 million in the area to help local tribes. The company now needs to approach the Ministry of Environment and Forests for further approvals.
