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Market Eye
| Sensex ends historic week with a 14% gain | 23/05/2009 11:03:51 | With global markets displaying some strength on a few sessions and outcome of general elections 2009 turning out to be a pleasant surprise with the Congress-led UPA alliance coming up with an impressive mandate, the bulls held sway once again in the Indian stock markets.
The market ended with sharp losses on a couple of sessions, but gains recorded by it on the opening session were so strong that it had no difficulty in signing off on a high note and extending its winning run to an eleventh successive week.
While the 30-share BSE sensitive index Sensex shot up by 1,713.73 points or over 14% to 13,887.15, the broader 50-stock Nifty index of the National Stock Exchange rose 566.85 points or 15.44% to 4238.50.
It was an incredibly brilliant start for the market last week (May 18 - 22) with the Sensex recording its fastest ever 2000 points surge in history on Monday. The benchmark index took no more than a few minutes to jump from 12,173.42 to 14,284.21.
The Indian bulls stormed the ring at the stroke of the opening bell on Monday following the Congress-led UPA front winning a strong mandate in general elections 2009.
On expectations the new government would speed up reforms and give the necessary thrust to boost the sagging economy, the bulls shrugged off weak global markets and assembled in full strength that morning.
So strong was their presence that the benchmark indices Sensex and Nifty hit the upper circuit in a flash. While the Sensex shot up by over 10%, the Nifty flared up by more than 15%, forcing the market authorities to halt trading for a couple of hours.
And the trend was not any different when trading resumed at 11.55 a.m., The Sensex, which had moved up by 1305.97 points or 10.73% to 13,479.39 when trade was halted for the first time that morning, shot up to 14,284.21 immediately on resumption of trade a little before noon, recording an incredible gain of 2110.79 points or 17.34% for the day.
The Nifty, which had flared up to 4271.40 at the bell, galloped to 4384.30 and was up 17.74% or 651.50 points for the session. As the Nifty hit the 20% upper circuit barely a minute after trading resumed at 11.55 a.m., trading on both NSE and BSE was halted for the day.
After opening on a high note, stocks plunged sharply into the red in a flash on Tuesday morning as participants looked to book profits after the incredible show in the previous session.
Heavy buying in bank, realty, capital goods and automobile stocks on strong global cues then pulled the market out of the red. The Sensex, which vaulted nearly 1000 points from the day's low to 14,930.54 and looked well set to cross the coveted 15,000 mark, however, turned weak and plunged into the red on renewed selling and finally ended the session with a small gain of 18 points. The Nifty closed with a minor loss that day.
On Wednesday, a few bluechip stocks rallied sharply in afternoon trade and posted strong gains, but it was a weak outing for the benchmark index Sensex as it tumbled amid high volatility and closed with a big loss due to profit taking in some heavyweights.
Global cues were mixed when trade commenced that morning and they remained that way till the end. The statement from the Prime Minister elect Dr Manmohan Singh that his coalition would pursue reforms in agriculture, industry and the wider economy to push growth and make it even more inclusive did its bit to lift sentiment and pulled the Sensex out of the red, but with investors choosing to book profits in certain heavyweights, including Reliance Industries and ICICI Bank, the barometer plunged sharply into the red once again and despite some strong buying in Tata Motors, Tata Steel, Mahindra & Mahindra, Maruti Suzuki and a few other top notch stocks finished the session on a dismal note.
While the Sensex ended lower by 241 points at 14,060.66, the Nifty finished 48 points down at 4270.30.
Extending their losses for the second successive session, the Sensex and Nifty ended lower by 324 points and points respectively on Thursday. A statement from the US Federal Reserve that a full economic recovery will take more time to come proved to be a strong enough excuse for global markets to take a trip down South that day.
However, the market reverted to its winning ways on Friday, thanks to a firm trend on the European bourses and higher US index futures. As heavyweights rebounded sharply and posted strong gains, the Sensex ended higher by a little over 150 points that day.
Shares of state run oil marketing firms rallied higher on reports that the Petroleum Ministry has prepared a draft Cabinet note on freeing petrol and diesel prices from government control, after which they will be linked to international movements.
Realty, capital goods and infrastructure stock rallied higher on expectations of some positive measures from the government to boost national spending. Bank stocks rose on hopes that the government would go ahead with sectoral reforms. IT stocks remained slippery with a weak dollar weighing down the sentiment to a notable extent. A firm trend in global metal markets aided the cause of metal stocks.
From the Sensex, only five stocks ended lower last week. IT majors Infosys Technologies, Wipro and Tata Consultancy Services lost 4.7%, 2.4% and 1.9% respectively. FMCG heavyweight ITC (down 1.6%) and pharma major Sun Pharmaceuticals (down 0.6%) were the other two stocks to close on a weak note.
In the Nifty index, besides the four Sensex components mentioned above, Cipla (down 3.4%) was the stock to finish lower last week.
Reliance Infrastructure, Reliance Communications, Tata Steel, State Bank of India, Larsen & Toubro and Tata Motors gained 30%-37% last week.
DLF ended stronger by 29.4%. ONGC flared up by 28.6%. Jaiprakash Associates, Mahindra & Mahindra and ICICI Bank firmed up by 22% - 23.25%. BHEL gained 16.1%. HDFC Bank, NTPC, Tata Power, ACC, Grasim Industries, Maruti Suzuki and Reliance Industries gained 12% - 16%.
Ranbaxy Laboratories and Sterlite Industries ended more than 10% up. HDFC, Hindalco, Bharti Airtel and Hindustan Unilever also closed on a firm note.
Reliance Capital was the biggest gainer in the Nifty index. The stock shot up by as much as 52.7% last week. Unitech zoomed 39.6%. SAIL,
ABB, Nalco, Siemens, Suzlon Energy, BPCL, Ambuja Cements, Power Grid Corporation, Axis Bank, Punjab National Bank, Reliance Petroleum, HCL Technologies, Cairn India, Tata Communications and Idea Cellular finished with hefty gains. Hero Honda and GAIL India also closed with handsome gains last week.
Among the sectoral indices, BSE Realty flared up by 37.67% last week. The Capital Goods index shot up by a little over 28%. BSE PSU (27.12%), CD (24.94%), Metal (23.73%), Power (23.47%), Bankex (22.77%), Auto (16.99%) and Oil & Gas (15.33%) also closed with hefty gains.
BSE Healthcare and BSE Teck ended higher by 6.84% and 6.58% respectively. The FMCG barometer edged up by 1.24%. BSE IT ended with a marginal loss.
On hectic buying at side counters, BSE Midcap and Smallcap indices ended stronger last week, gaining 24.92% and 2.8.82% respectively | Market
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