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Benchmark indices ended marginally in the red amid volatile trading in a truncated week on capital outflows and caution due to monthly expiry of derivative contracts. Global cues were stronger though, particularly good economic data in the US.
In the week ending December 26, the 30-share Sensex lost 0.47 per cent or 130.06 points at 27,242, while the 50-share Nifty ended down 0.29 per cent or 24.50 points at 8,221.
In the broader market, the BSE Mid-cap Index performed better than the front-liners with a gain of 0.74 per cent, while the BSE Small-cap Index’s loss of 0.29 per cent was lower than the fall in the Sensex.
Foreign investors were net sellers in equities to the tune of Rs 3,548.47 crore during the week, as per provisional stock exchange data.
Key events
Traders ended the December derivatives series on a cautious note rolling over fewer positions in the Nifty futures segment. The Nifty futures contracts saw a rollover of only 66 per cent, compared to a three-month average of around 70 per cent. Experts said the rollover indicates that trades have turned risk-averse amid selling by overseas investors.
The government on Friday promulgated an ordinance to raise FDI limit in the insurance sector from present 26 per cent to 49 per cent and re-promulgated the coal block ordinance to facilitate the e-auctioning of coal blocks after failing to get the related bills passed during the winter session due to repeated disruptions in the Rajya Sabha.
On the political front, experts believe that BJP’s strong maiden performance in Jammu and Kashmir Assembly elections along with the simple majority it attained in Jharkhand with its ally will strengthen the central government allowing smoother rollout and execution of reforms.
Among global cues, in the third quarter, the US economy grew at its fastest pace in 11 years, leading to speculation that the proposed rate hike by the Federal Reserve will arrive sooner than later and a strengthening US dollar will put a squeeze on capital inflows to emerging economies.
The BSE Realty Index, up 2.3 per cent, was the top gainer among the sectoral indices followed by BSE Auto and Power indices. BSE Capital Goods index, down 1.79 per cent, emerged as the top loser followed by BSE IT and Consumer Durables indices. Bharti Airtel was the top gainer of the week ending 3.4 per cent higher. The stock came under some pressure on Friday when the company announced that it would impose additional charges for Voice over Internet Protocol (VoIP) calls made through mobile phones using services like Skype and Viber.
Week ahead
From Thursday, auto companies will start releasing their monthly sales volume data for the month of December 2014.
On Friday and Saturday, Prime Minister Narendra Modi will interact with bankers during two day Bankers Retreat called ‘Gyan Sangam’ in Pune to flesh out a blueprint for banking sector reforms.
For the month of December 2014 India’s HSBC Manufacturing PMI compiled by Markit Economics will be released on Friday along with the HSBC PMI of Eurozone, US and France. On Wednesday, Markit will release China HSBC PMI.
Most global markets will remain closed on Thursday for New Year.
