Markets continue their upward climb

The charge of the bulls continued last week as well. The Sensex was up 5.3 per cent from the previous weeks close and ended at 14,625 points on the last trading day of the week. Foreign institutional investors FII pumped in Rs 4,982.5 crore in equities during the week. According to Kishor Ostwal,chairman and managing director,CNI Research,The markets were largely momentum driven last week and are expected to retain such moves until the next monetary policy review by the Reserve Bank of India. We expect a cut in the cash reserve ratio CRR and in turn expect fresh investment in the markets.

The major sectoral gainers were realty and metals. Both the sectors grew by 15.4 per cent and 11.7 per cent respectively. The expectation of a CRR cut is driving the realty and metal sectors as these are the sectors that will be directly affected by this cut, says Ostwal. Besides,all the sectors ended in the green. Healthcare and FMCG gained the least with and registered 1.7 per cent and 0.8 per cent gains respectively. FMCG and healthcares performance depends on GDP growth. These sectors are expected to perform well from Q3FY10, adds Ostwal.

The Sensex is expected to touch the 15,100 to 15,200 level in the near term and after corrections may come back to the 14,000 mark,believes Ostwal.

Inflation rate for the week ended May 16 remained at 0.61 per cent same as last week. Gold,on the other hand,witnessed a surge of 2.2 per cent during the week and is currently trading at Rs 14,845 per 10 gram.

Price of crude oil too jumped and ended the week with a 9.7 per cent gain. Black gold is currently trading at 64.4 per barrel. The rupee also appreciated by 0.2 per cent and is currently trading at 47.1 vis-à-vis the dollar.

Niti Kiran