Stocks: Despite tail-end selling in view of cautious approach by investors,both S&P BSE benchmark Sensex and NSE Nifty gained for the second straight week on persistent buying mainly in rate-sensitive sectors on hopes of a rate cut by the Reserve Bank of India next week.
Brokers said the sentiment was bolstered on expectations that easing inflation and weak commodity prices might prompt the central bank to cut interest rate in an aggressive manner in its monetary policy meeting on May 3.
Persistent capital inflows from foreign funds also boosted the market sentiment. Foreign Institutional Investors (FIIs) have invested Rs 3,045.95 crore during the current week,including the provisional figure of April 26.
IT stocks like Wipro,Infosy and TCS saw selling on muted growth prospects. The infotech sector was particularly impacted because of the concerns on provisions of Immigration Bill tabled in the US Senate. The world’s largest economy is the biggest market for Indian IT firms.
The 30-share Sensex resumed lower at 18,989.78 and dropped to 18,989.78,but recovered afterwards to hit a 6-week high of 19,434.85 before ending the week at 19,286.72,a net gain of 270.26 points,or 1.42 per cent,from last weekend’s level. The BSE benchmark has gained a hefty 1,044.16 points,or 5.72 per cent,in the last two weeks.
The NSE 50-share Nifty also rose by a healthy 88.35 points,or 1.53 per cent,to finish the week at 5,871.45. The broader index has gained 342.90 points,or 6.20 per cent,in the last two weeks.
The market had a truncated trading week as both BSE and NSE were closed on April 24 on account of “Mahavir Jayanti”.
Buying was broad-based as 21 of the 30 Sensex scrips ended higher,while nine posted losses.
Major gainers were Maruti Suzuki (9.64 pct),Coal India (6.63 pct),HDFC (6.59 pct),Bharti Airtel (6.32 pct),Hero MotoCorp (6.28 pct),NTPC (6.10 pct),Hindalco Ind (5.71 pct),Bajaj Auto (5.66 pct),Gail India (5.36 pct),L&T (4.69 pct),Tata Motors (4.94 pct) and Dr Reddy’s Lab (4.49 pct).
Among the key losers Wipro dropped by 10.45 pct followed by Jindal Steel (6.52 pct),TCS (5.69 pct),HUL (3.69 pct),Infosys (3.62 pct) and M&M lost 1.24 pct.
Among the major indices,S&P BSE-Auto rose by 4.11 pct followed by S&P BSE-Capital Goods 3.16 pct,S&P BSE-Consumer Durable 2.48 pct,S&P BSE-Power 2.02 pct,S&P BSE-Bankex 2.04 pct,S&P BSE-HC 2.10 pct,S&P BSE-Metal 1.77 pct and S&P BSE-PSU gained 1.16 pct.
However,S&P BSE-IT dropped sharply by 4.83 pct and S&P BSE-Teck went down by 2.24 pct.
The total turnover at BSE and NSE rose to Rs 8,790.56 crore and Rs 48,692.75 crore,respectively from the last weekend’s level of Rs 8,242.21 crore and Rs 46,997.76 crore previously.
Forex: The Indian rupee snapped its fortnight gains by slipping 41 paise to end the week at 54.37 against the American currency on heavy month-end dollar demand from importers and banks,despite good capital inflows from foreign funds.
Firm dollar at the overseas also affected the rupee value against the dollar,a forex dealer said.
The rupee resumed steady at 53.96 against the American currency at the Interbank Foreign Exchange (Forex) market and hovered in wide range of 53.92 per dollar and 54.42 per dollar before ending the week at 54.37 per dollar,showing a net loss
of 41 paise or 0.76 per cent.
In previous two weeks it had gained by 85 paise or 1.55 per cent.
Pramit Brahmbhatt,CEO,Alpari Financial Services (India) said after trading strong for two weeks Rupee traded weak,taking cues from strong dollar which traded on the high side during the week,but the strong local equities tried to support rupee with the help of foreign funds which have been poured in over USD 500 million in equities in the past 4 days.
On May 3 the Reserve Bank of India (RBI) is likely to cut interest rates for a third time this year,as this time India’s inflation dropped to its lowest in more than three
years during March,at 5.96 pct.
Meanwhile,the BSE benchmark Sensex rose by 270.26 points or 1.42 per cent to 19,286.72.
The rupee premium for the forward dollar finished lower on sustained receipts by exporters.
The rupee premium for the benchmark six-month forward dollar payable in September closed down at 154-1/2-156 paise as against the last weekend’s level of 163-1/2-165-1/2 paise and far-forward contracts maturing in March also ended lower
at 321-323 paise as against 329-1/2-331-1/2 paise.
The RBI fixed the reference rate for the US dollar at 54.2935 and for euro 70.6750 as against the last weekend’s level of 54.0298 and for euro 70.4933.
The rupee turned lower against the pound sterling to 84.07 from preceding weekend’s level of 82.38 and also declined against the euro to 70.70 from 70.48 previously.
It also moved down against the Japanese yen to settle at 55.07 per 100 yen from last weekend’s level of 54.85 per 100 yen.