Last week the Sensex touched an intra-day low of 8,000. It then ended the week on a flat note,down 0.9 per cent compared to the previous weeks close. Some momentum was witnessed in the sectoral indices. The major gainers for the week were Oil and Gas and Information Technology (IT),which grew 2.7 per cent and 2.5 per cent respectively. The realty sector was heavily battered last week,declining almost 7.5 per cent.
The index of industrial production for the month of November 2008 stood at 2.4 per cent,compared to a contraction of 0.4 per cent in October. Inflation fell again to 5.24 per cent for the week ended January 3,2009,from 5.91 per cent in the previous week. However,these positive developments failed to enthuse the markets.
Shrikant S. Chouhan,vice president-technical research at Kotak Securities believes that the market will remain weak in the medium term. He says: After the Satyam debacle investments have shifted to other stocks in the IT sector. And realty sector continues to face a severe cash crunch. Chouhan is bullish on power and banking sectors as they have attractive prospects and are also priced inexpensively.
Q3 results from companies such as Infosys Technologies,Tata Consultancy Services and HDFC Bank were a mixed bag. Concerns over corporate governance issues are in future expected to play a part in the choice of stocks by investors.