The markets had another week of extreme volatility. Sensex lost 242.22 points or 0.85 per cent to close at 28,261.08 points while Nifty lost 76.85 points or 0.89 per cent to close at 8,570.90 points. Broader markets lost similar with BSE100, BSE200 and BSE500 losing 0.89 per cent, 0.82 per cent and 0.94 per cent respectively.
The top gainer in sectoral indices was BSEOIL&GAS up 2.17 per cent followed by BSEHEALTCARE 1.23 per cent and BSEIT 0.67 per cent. On the losing side were BSEREALTY down 3.53 per cent, followed by BSEPOWER 3.5 per cent and BSEFMCG 2.78 per cent.
In individual stocks, gainers were led by Infosys up 1.94 per cent, Ranbaxy 1.77 per cent, Dr Reddy 1.63 per cent and Lupin 1.49 per cent. Losers were led by NTPC down 8.81 per cent, followed by Bharti Airtel 5 per cent, Hind Lever 4.67 per cent and ITC 3.39 per cent. The FED at its meeting allayed fears of global market interest rates rising in a jiffy.
The two contentious bills, Mines and Minerals Development Regulation Act and Coal Mines Amendment Bill, were passed in the Rajya Sabha. The passage of these two bills will give the economic thrust of the NDA government a big boost.
Dow Jones closed at 18,127.65 points, a weekly gain of 378 points or 2.13 per cent. FIIs were buyers of equity worth Rs 1,016 crores while domestic institutions were sellers of R 342 crores. Rupee gained Rs 0.50 or 0.79 per cent to close at Rs 62.46. March series futures expires on Thursday, is currently trading 113 points or 1.3 per cent lower than expiry of 8,683.85 points.
On the IPO front the issue from Inox Wind received excellent response from investors of all categories. The issue was subscribed 18.60 times overall. On the other hand the IPO from Ortel Communications which listed during the last week had a poor start and was down over 9.72 per cent on the BSE after two days of trading. Shares which were allotted at Rs 181 were trading at Rs 163.40.
SEBI had its board meeting, where a number of decisions were taken. The key decision from the market perspective was the one relating to conversion of debt into equity by listed entities to banks and financial institutions. Under this dispensation no takeover code would apply as long as the promoter entity continued to hold 51 per cent stake. Also, the conversion price will be based on a pricing formula, and this will help banks and listed entities to turn around.
The week ahead would see expiry of March futures on Thursday and the financial year end on Friday. NAV pricing would happen on Tuesday, March 31 when one does see some unusual movement in midcap and small cap stocks. Key drivers for the market would be political action in Parliament post these two bills being passed and the intent of more to come. With a substantial correction behind us the time to pick and choose shares is here again. Do so selectively.
Arun Kejriwal is founder of the Mumbai-based advisory firm Kejriwal Research & Investment Services Pvt Ltd. Readers are invited to read more about these and other issues on his website http://ak57.in
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