Weekly markets: Global cues take Sensex higher

Realty, bank and oil stocks languish

Markets gained for the fourth straight week on global cues. Markets in US and Asia rose on speculation policy makers in the US and China will ease monetary policy to boost growth in the world's two biggest economies.

The Sensex added 92 points or half a per cent to 17,783. Nifty ended the week at 5,386 - up 20 points.

In the recently released annual report, RBI has said the fiscal consolidation and reducing revenue expenditure so that the money left can be spent on the capital expenditure are the much needed steps from the government side to boost growth and helping in lowering of interest rates. The report also cited concerns on likelihood of higher fiscal deficit this year in light of higher burden of subsidies and possibility of lower tax collections as a result of weaker economic growth.

The government announced that the July CPI stands at 9.86% y-o-y. The country's annual consumer price inflation slowed slightly in July helped by a drop in petrol prices at the pump, government data showed on Tuesday, but a drought in parts of the country pushed food prices higher.

The benchmark indices ended on a strong note on Tuesday, led by heavyweights such as Infosys, HUL and HDFC. Wednesday saw markets slip on soft global cues. Thursday was a lacklustre day with oil and auto shares dropping in trades. On Friday, benchmark share indices ended lower, amid a volatile trading session, weighed by weakness among Metal, Banks and Capital Goods shares. Weak performance of the global markets also dampened the sentiments among local investors.

IT companies continue to remain in limelight on the bourses after minutes from the US Federal Reserve showed that the central bank's policy committee discussed a third round of quantitative easing at its last meeting. BSE IT Index surged 3.3% to 5,798.

Bank employees in India began a two-day strike on Wednesday to protest against proposed reforms that would ease mergers and allow more private capital, including foreign investment, in the banking sector. BSE bankex ended down 0.7% at 11,872.

BSE realty index was the top loser - down 2.5% at 1,591. Oil & gas, capital goods and consumer durables also declined in trades.

Broader markets ended down 0.6% each.

Coal India added 2.2% to Rs 367 on reports that the state-owned mining company has decided to buy back its own shares. The stock was the top gainer of this week, followed by IT shares.

Infosys advanced 4% to Rs 2,445 after the company won a harassment case filed by its employee Jack Palmer, after a US Judge dismissed his claims and threw out the case on Monday.

Hindalco was among the top losers. It slipped 2.6% at Rs 111 on reports that the Odisha State Pollution Control Board (OPSCB) has asked the company to shut down the captive power plant (CCP) of smelter plant near Hirakud in western Odisha in the wake of a breach in the company's ash pond that damaged standing crops in the locality.

Bharti Airtel shed 5.3% to Rs 248, its lowest level since October 2006 in morning trades on the NSE after Morgan Stanley downgrades the stock to "equal-weight" from "overweight". According to a Reuters report, “Morgan Stanley says traffic growth is coming at the expense of operating margins as tariff wars in the sector bring down average revenue per minute for voice calls.” Investment bank cuts its target price to Rs 280 from Rs 366, added the report.

ONGC added 1.8% at Rs 287after it signed an agreement with Mitsui & Company of Japan for a wide ranging cooperation in the gas and LNG businesses.