Markets end marginally higher; IT, power up, cap goods dips

19 March 2009

The markets closed marginally higher after witnessing volatility throughout the day. The Sensex hovered around the 9000 mark while the Nifty traded around the 2800 level for most of today's session. Shares of technology, oil & gas exploration, select financials and power stocks helped the markets. Broader indices outperformed the benchmark indices for the second consecutive day.

However, the sell-off was seen in capital goods, select metal, and auto stocks, HDFC Bank, Reliance Communication, HUL and Grasim.

The 30-share BSE Sensex closed at 9,001.75, up just 25.07 points or 0.28%, after swinging 186 points between an intraday high of 9,086.77 and low of 8,900.39. The 50-share NSE Nifty swung nearly 51 points between day's high/low of 2822.25 and 2771.35, respectively. It gained 12.45 points or 0.45%, to settle at 2807.15.

Top gainers were Sterlite Industries, HDFC, Sun Pharma, Maruti Suzuki, TCS, Ambuja Cements, and NTPC, which gained 1.6-4%. However, L&T, BHEL, Tata Motors, Reliance Communication, M&M and NALCO were top losers; those went down 2-4%.

Inflation for the week ended March 7 came in at 0.44% week-on-week (WoW) compared to 2.43%. It was at all-time low. The Wholesale Price Index (WPI) for all commodities is down by 0.4% at 226.7 WoW. January 10 revised WPI inflation is at 5.46% vs 5.60% (Provisional).

Indranil Sengupta, Chief Economist at DSP Merrill Lynch, sees deflation coming in a few months, arising from the base impact. Inflation, he feels, is not a worry for 5-6 months and some more monetary easing is expected. He sees some revival in demand due to decrease in lending rates. "We are likely to see a 100 bps lending rate cut in the slack period between April and September."