Slow but not steady

Last week the market witnessed a weak closing Nifty closed down around 14 per cent and Sensex down around 13 per cent Healthcare and FMCG sectors were down around 23 per cent and 18 per cent respectively In the large cap session TCS and HDFC Bank were the gainers with a rise of around 55 per cent and 43 per cent respectively The losers were JP Associates and Sesa Goa which closed down around 122 per cent and 7 per cent respectively Mario Draghi President of the European Central Bank ECB addresses a press conference following the meeting of the Governing Council in Frankfurt am Main Germany on February 7 2013 PicAFP Big winner The major earnings for the week were of distiller United Spirits whose net profit jumped 71 per cent on the back of cost control and strong volume growth The company posted a net profit of Rs 8055 crore for the third quarter ended December 2012 as compared to Rs 4706 crore for the same period last year The net sales of the company also rose to Rs 217401 crore as against Rs 195394 crore on a year on year basis The stock prices rose to its highest level as it recently got SEBIrsquos nod for the open offer for acquiring 26 per cent stake from public share holders of the UB Group by Diageo The HSBC servicesrsquo PMI data which was released during the week showed that rising foreign orders were the main drivers The data jumped to 575 in January from a level of 556 in the previous month The new business subindex rose to 583 which is the highest level since August 2011 On the other hand PMI data related to manufacturing fell to its slowest pace in three months Gold rules In order to discourage investments in physical gold the RBI suggested a mandatory quoting of Permanent Account Numbers PAN for high value purchases The central bank committee also proposed a cheque payment for gold purchases above a certain limit The RBI put forward a proposal of setting up a Bullion Corporation in order to discourage gold imports and making use of idle gold reserves Foreign cash In the month of January foreign investors pumped around Rs 22000 crore USD 4 billion into Indian stock markets According to SEBI the FIIs were buyers of shares worth Rs 77859 crore while they sold equities amounting to R55800 crore which in turn translated into a net inflow of Rs 22059 crore USD 405 billion Apart from equities they invested around Rs 2947 crore in the debt market in January In 2012 FIIs made a net investment of Rs 128 lakh crore USD 244 billion in Indian equities making it the second best year for the market after a record inflow of Rs 133 lakh crore USD 29 billion in 2010 Global news Meanwhile the US markets continued to shift between green and red throughout the week The betterthanexpected jobs data and ISM data helped the US markets to open on a green note in the beginning of the week However European Central Bank ECB president Mario Draghirsquos comment that the rising Euro may impact the growth of economy dragged markets all over the globe into negative territory China reported a betterthanexpected trade data The exports were seen up around 25 per cent in January on a yearonyear basis and also the imports surged 288 per cent Looking ahead In the coming week the release of inflation data might act as a trigger for Indian markets The revelation of corporate earnings will also be watched Companies that may announce their quarterly numbers include Tata Steel HPCL Tata Power GAIL and CESC Gold has support at USD 1662 and USD 1653 Resistance for gold is at USD 1695 Movements above this level can lift international gold price Nifty has support at 5873 and 5815 100 DMA Resistance lies at 5927 and 5959 50 DMA movements above these two levels can lift the sentiments further Counters like LampT BHEL and Tata Power are in the over sold region and these stocks can be utilised to create long positions with Nifty futures hedge Alex K Mathews is the author of Financial Services And Systems as well as Option Trading Bear Market Strategies published by Tata McGraw Hill He is also the technical and derivatives research head of Geojit BNP Paribas Financial Services Ltd The author may have a vested interest in investments he has recommended Feel free to email him at alexgeojitcom Geojit BNP Paribas has membership in and is listed on the National Stock Exchange NSE and the Bombay Stock Exchange BSE Disclaimer No financial information whatsoever published anywhere in this newspaper should be construed as an offer to buy or sell securities or as advice to do so in any way whatsoever All matter published here is for educational and information purposes only and under no circumstances should be used for actual trading or making investment decisions Readers must consult a qualified financial advisor prior to making any actual investment or trading decisions based on information published here Any reader taking decisions based on any information published here does so entirely at his or her risku00a0