Volatility was order of the day, as investors were uncertain about global cues. While caution was the buzzword, key indices ended with gains as global stocks recovered. BSE Sensex rose 362 points or 2.3 per cent to 16,153, while Nifty rose 108 points or 2.3 per cent to 4,827.
Mid-caps and small-caps were outperformers, BSE Mid-cap index rose 2.6 per cent and Small-cap index jumped 2.8 per cent. FII outflows in February stood at Rs 2,250 crore and their total outflows in 2010 stood at Rs 2,753 crore. The food price index rose 17.94 per cent for the week ended January 30, higher than 17.56 per cent in the previous week.
Markets this week
Reports of France and Germany proposing a bailout plan for Greece and speculation about the Fed’s exit strategy could influence the markets. On the domestic front, easing of foreign investment rules will have a positive effect on the markets on Monday.
Reports of government’s borrowing programme being within the current year’s target could alleviate market fears of higher borrowing. Nevertheless, analysts say that the recent pullback was a technical one. They point out that markets could witness bouts of volatility on road to the Union Budget as there are expectations of the finance minister initiating an exit from stimulus policies announced by the government earlier.
Stock to watch TATA STEELLast week’s close (Rs) 533.98 Prev. week’s close (Rs) 550.33 Week’s high (Rs) 567.45 Week’s low (Rs) 519.50 Last week’s ave. daily turnover (Rs cr) 623.75 Prev. week’s ave. daily turnover (Rs cr) 608.25 Number of up/down move 1/3 Dalal Street will closely watch the consolidated December quarter results of Tata Steel to be announced on Tuesday, February 16. The results will be critical on many counts. The company’s revenues and profitability are expected to be significantly lower compared to the year ago quarter. However, after three consecutive quarters of losses, the company is expected to report profits at the consolidated level. |
Besides churning in profits, realisations and impact of cost cutting exercise undertaken by the company earlier will be among key things to watch. Analysts are expecting the consolidated net profit to drop by over 80 per cent year-on-year. But, this is still better compared to the loss of Rs 1,795 crore in the September 2009 quarter. Its biggest contributor, Corus (European operations) is expected to report an improvement in operating profit margins led by better demand, higher volumes and steel prices and, cost rationalisation.
