The markets opened positive and the mood was by and large the same but the fireworks were missing. The BSE SENSEX gained 113.86 points or 0.54 per cent at 21,193.58 points. The NIFTY gained 39.55 points or 0.63 per cent to close at 6,313.80 points. The broader indices like the BSE100, BSE200 and BSE500 gained 0.72 per cent, 0.90 per cent and 1.06 per cent respectively.
The BSE MIDCAP gained a significant 2.39 per cent while BSE SMALLCAP fared even better gaining 3.58 per cent. The top sectoral gainer was BSE REALTY up 3.39 per cent. Other gainers included BSE CON DURABLE up 2.51 per cent and BSE CAPGOOD up 2.37 per cent. There were just two losers in BSE AUTO down 0.40 per cent and BSE OILGAS down 0.05 per cent.
In individual stocks, the biggest gainer was PNB up 6.78 per cent followed by Union Bank up 5.73 per cent. Other gainers included BHEL up 4.65 per cent. Stocks such as Gitanjali Gems rose a staggering 53.07 per cent. Maruti led the few losers down 1.93 per cent and Reliance Industries down 1.68 per cent.
Dow Jones rallied further to touch 16,478 points, a gain of 257 points or 1.58 per cent. FIIs were buyers of equities worth Rs 1,460 crore while domestic institutions were buyers of Rs 76 crore. The Indian rupee gained 0.19 paisa or 0.31 per cent to close at Rs 61.85. The December futures expired without the usual volatility witnessed at a level of 6,278, which was higher by 3.07 per cent.
With just two trading sessions in the current year, the SENSEX is up roughly 9.09 per cent while the Nifty is up 6.9 per cent. These returns are less than inflation, which means that anyone investing in the benchmark indices has ended the year with negative returns. In individual stocks, IT and pharmaceutical have been out performers and should continue to do well.
The FMC or Forwards Market Commission has asked the Financial Technologies group to reduce their holding in MCX from 25 per cent to 2 per cent. This is post their declaring Jignesh Shah and the nominee directors from the FT group as being 'not fit and proper' persons. In another related development, an investor group has filed a complaint stating amongst others that the brokers involved in the NSEL case have not done their due diligence or performed their functions as expected. Parting with investors' money without taking proper security is a major lapse. NSEL seems to be in the thick of action and the issue is not going to die down so quickly.
HDFC and NSE have acquired a stake in a registrar CAMS. Some time ago, BSE was looking to acquire the stake and the regulator SEBI had rightly turned down the request saying there would be a clash of interest. One wonders what the change in reasoning this time was around. HDFC runs one of the large mutual funds and NSE is a stock exchange regulating a body like HDFC indirectly or directly. When the two are partners in a venture, one wonders as to who would regulate and who would be regulated. Certainly, a decision like this does not augur well for the investors and should be re-looked at.
The much hated 'PCA' or periodic call auction is to be scrapped in the form it existed and a substantially watered down version will be in place in a couple of weeks' time. Broadly speaking, three-fourth of the stocks would exit this system. This would improve liquidity and partially bring back the retail investor to the markets, even if it is to sell the shares in which he was stuck. Sensing this apparent change, stocks from the midcap and small cap have rallied sharply in the last week and have outperformed the markets.
Key levels for the SENSEX are 20,755 and 21,325 while they are 6,225 and 6,360 for the NIFTY. The support for the SENSEX is at 21,126 points, then at 21,010 points, then at 20,918 points, then at 20,745 points and finally at 20,575 points. It has resistance at 21,248 points, then at 21,327 points, then at 21,369 points and finally at 21,483 points. The NIFTY has support at 6,293 points, then at 6,273 points, then at 6,258 points and finally at 6,208points. It has resistance at 6,329 points, then at 6,339 points, then at 6,364 points, and finally at 6,415 points. The week would be a low volume but smallcap and midcap dominated week.
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