Choppy currents ruled in the week gone by
The markets continued to remain choppy and highly confused in the week gone by. They managed to close with gains of one per cent and more finally on various news flow. The Sensex gained 257.91 points or 1.01 per cent to close at 25,868.49 points while the Nifty gained 94.30 points or 1.21 per cent to close at 7,856.55 points. What is significant is the fact that both indices found support and rebounded from levels which were considered as support. The Sensex touched a low of 25,451 and the Nifty 7,714. The lows made two days later were at 25,453 and 7,725 respectively. These levels will become significant levels of support in the coming weeks.
Mali’s President Ibrahim Boubacar Keita (c) visits the Radission Blu hotel in capital Bomako, the day after the siege. PIC/AFP
The broader markets saw the BSE100, BSE200 and BSE500 gaining more at 1.23 per cent, 1.33 per cent and 1.38 per cent respectively. The BSEMIDCAP gained 1.92 per cent and BSESMALLCAP 2.18 per cent. In sectoral indices the top sector was BSE OIL&GAS up 4.28 per cent followed by BSE FMCG 2.81 per cent and BSE CAPGOOD 2.35 per cent. The losers were led by BSE REALTY 1.46 per cent and followed by BSE IT 1.11 per cent and BSE TECK 0.53 per cent. In individual stocks, GAIL was the star, up a massive 23.84 per cent, after Petronet LNG would be able to renegotiate a long term contract for gas sourcing from ‘RAS’ from the UAE. This would save a massive sum of money to Petronet and make gas supplies to GAIL that much cheaper. The other gainers were Vedanta 6.76 per cent, Mah&Mah 5.36 per cent, Hind Petro 4.71 per cent and ITC 4.54 per cent. The losers were led by Axis Bank down 5.09 per cent and followed by PFC 5.10 per cent and REC 4.00 per cent.
Global markets rallied behind the Dow Jones after it became increasingly clear that interest rates would be raised in the December meeting of FED. The Dow Jones gained 578.57 points or 3.35 per cent to close at 17,823.81 points. The rupee lost 9 paisa or 0.14 per cent to close at Rs 66.18.
This week sees two important events. The first is the winter session of Parliament beginning from Thursday, November 26 and the second is the expiry of November series futures. There are as many as 67 bills pending in Parliament after the monsoon session was a washout. After the success of the ‘Mahagatbandhan’ in Bihar, Congress has every reason to feel elated, and the appointment of Rahul Gandhi as Congress president seems imminent. In this connection his meeting with FIIs about the role of the opposition becomes important. One can easily read between the lines that, probably, the Congress would certainly prefer to debate issues rather than staging walkouts and obstruction of the house. If this happens, it would be great news for the country, consequently the markets too, as there will be debates and debates lead to outcome.
The November series expires on Thursday, November 26 and the current value of Nifty at 7,856.55 points is 255.20 points or 3.15 per cent lower than the expiry of October at 8,111.75 points. The month has been quite choppy and the bulls would like to pull back as much as they can from the current deficit. If the mood of Parliament in the first few days is conducive to discussion, they would be able to do so to a large extent.
After Paris, there were terror attacks in Mali and it is hugely tragic the way innocent people are being targeted in these terrorist acts. While the world seems to be seized of the issue unless drastic steps are taken and the base of these people is destroyed, the world would not be a safe to place live in.
The government seems to be firing away on all cylinders ever since the adverse Bihar election results. First it was FDI, then it is stalled projects, now it is the pay commission report which will cost the exchequer as much as one lakh crore per annum. The stock market looks at it as a golden opportunity to increase consumption, as this would be higher spending power in the hands of the middle income group. If this happens, this could be a big kicker to boost spending and increase consumption.
Shares of S H Kelkar and Company the fragrance and flavour company listed on Monday, November 16. Against an issue price of Rs 180, the issue closed at the end of the week at R 214.90, a gain of Rsd 34.90 or 19.38 per cent. In the last three weeks, there have been three listings with only the first Coffee Day Enterprises doing badly and trading at a significant discount, while Interglobe Enterprises is doing exceedingly well. The primary market pipeline is strong. From January 1, E-IPO would be introduced where every applicant has to apply through ASBA. This will help in reducing the time to listing to half.
This is a crucial week for the markets and key drivers would be our Parliament, and, the stance of various political players on discussions in the house going forward.