After the previous week's decline, markets started this
week on a firm note. Positive global cues helped the indices
to rally ahead on Monday and the Sensex ended more than
200 points higher. ONGC led the rally, ably supported
by select engineering, telecom and auto stocks
up trend continued on Tuesday as global markets remained
firm. Cement and select banking stocks helped the indices
while Jet Airways and Ranbaxy surged ahead
stocks saw a sharp up move on Wednesday and all of them
ended with significant gains. ICICI Bank led the gains
while select stocks in FMCG and metals also found interest.
Jet Airways continued its rally as the Sensex moved closer
saw a spectacular up move, once again led by the banking
stocks. The Sensex and Nifty ended with gains of close
to 3 per cent each as all frontline banking stocks ended
with significant gains. ONGC surged 5 per cent while Reliance
Industries provided good support. Telecom, engineering
and auto stocks also found very good interest.
consolidated on Friday after 4 days of sustained gains
and ended modestly lower. Most of the big gainers in previous
sessions saw some profit booking and ended lower. Higher
crude oil prices and inflation which remained high also
recovered a significant 856 points or 6.89 per cent for
the week and the Nifty surged 252 points or 6.98 per cent
over the week. The recovery came after the Sensex and
Nifty corrected around 14 per cent each over the previous
and small-caps also staged a good recovery. However gains
were lower than the large caps as they underperformed
during the middle of the week. CNX Mid-Cap 100 index closed
the week with gains of 256 points or 5.57 per cent for
economic and regulatory action
price inflation for the week ended 10 March remained
steady at 6.46 per cent, marginally below consensus
estimates of around 6.5 per cent. No clear trend was
visible in price movements, with no particular segment
showing any major change. While prices of some primary
food articles and manufactured products went up, prices
of select others declined. Inflation was at 3.8 per
cent during the same week of previous year.
markets, global economy and oil
markets rallied this week on hopes of an interest rate
cut by the Fed before the end of the year and receding
fears about the troubles of mortgage lenders spreading
to other segments. Indices gained on most sessions of
the week, except on Thursday when they ended without
much change. The resurgence in oil prices helped stocks
in that sector and pushed up the indices further.
Frontline US indices saw their best weekly returns in
nearly 4 years. The Dow gained 3.1 per cent for the
week while the S&P 500 index rallied 3.5 per cent.
NASDAQ ended with gains of 3.2 per cent for the week.
its policy meeting this week, the US Fed kept its key
interest rate unchanged at 5.25 per cent as widely expected.
More significantly, the Fed changed the language of
its policy statement which many economists interpreted
as a removal of the Fed's bias towards further tightening.
Financial markets read the change as a shift to a more
neutral policy stand and hopes of a rate cut before
this calendar year end have increased.
The Fed's assessment of the US economy is more muted
than in previous policy statements, which may be another
sign of a shift in policy bias. However, the Fed has
not lowered its guard on inflation and has specifically
mentioned that the possibility of price levels not moderating
as expected remains its 'predominant policy concern'.
Much would depend on US inflation in the coming months,
which in turn depends heavily on energy prices.
for the month of February has led to hopes that the
US housing sector may see better days ahead. Housing
has been the biggest drag on the US economy in recent
quarters and any recovery is welcome news. Data released
earlier this week showed that new housing starts increased
in February while subsequent data showed an unexpected
rise in sale of pre-owned houses. Though supply of houses
available for sale increased, sales continued to rise
for the third successive month. Going forward, more
mortgage defaults would lead to a further rise in supply
of houses and keep prices subdued.
oil prices rallied this week on forecasts of higher
energy demand this year and worries about the further
political tension in the Middle East. The UN is set
to discuss sanctions on Iran for its failure to comply
with directives on its nuclear programme.
The Iranian president has cancelled his proposed UN
visit, indicating a more belligerent stand. To make
matters worse, Iran detained some British military personnel
in the Gulf.
Near month NYMEX futures surged over $5 per barrel over
the week to settle at $62.28 per barrel on Friday.
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above at the time of writing this article. This analysis/report
is only for the purpose of information and is not an investment
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