India Insight

Markets this week: ICICI, Hindalco top Sensex gainers

By Sankalp Phartiyal and Ankush Arora

The BSE Sensex and the Nifty rose more than 2 percent in a week that was largely lacklustre until the main stock indexes hit fresh life highs on Friday, buoyed by optimism that India’s principal opposition party would get a majority in the ongoing election.

Security personnel stand guard as voters line up to cast their votes at a polling station at Badkoot in Kupwara district, north of Srinagar May 7, 2014. REUTERS/Danish IsmailOn Monday, India will vote in the last leg of its staggered five-week long election that began on April 7. Results are due on May 16.

India will release factory output and inflation data on Monday. According to a Reuters poll, factory output in March probably contracted for the fifth time in six months, while food and fuel prices inched higher.

“Focus will be firmly on the exit poll numbers due on Monday evening as well as on the final election results on Friday,” said Sanjeev Zarbade, Vice President – Private Client Group Research, Kotak Securities.

In the currency market, the rupee hit a one-month high of 59.9225 on Thursday. A Reuters poll showed the Indian unit will likely trade near 60.0 per dollar over the next three months before falling to 62.30 in a year.

Markets this quarter: Sensex gains 5.7 percent, L&T surges 19 percent

By Aditya Kalra and Sankalp Phartiyal

Indian shares posted record highs in March as strong foreign buying sent blue-chip stocks such as Larsen & Toubro higher and boosted overall investor sentiment ahead of a general election.

Provisional data showed foreign investors bought shares worth more than $3 billion in March, pushing the BSE Sensex to a life high of 22,467.21 points on the last trading day of the quarter. While the index rose 6 percent during the month, it rose 5.7 percent in the Jan-March period.

Markets rallied on hopes that the main opposition Bharatiya Janata Party, perceived to be more business -friendly, would emerge as a winner in the general election, while hopes of a recovery in the domestic economy also aided sentiment.

Markets this week: M&M, GAIL top Sensex losers

By Sankalp Phartiyal and Ankush Arora

India’s benchmark indexes ended lower this week after scaling fresh peaks on Tuesday. The Sensex ended the week down 0.26 percent in its second consecutive week of falls. Indian markets were shut on Monday for a public holiday.

While strong buying by foreign investors bolstered blue chips, profit-booking and worries U.S. interest rates would rise sooner than expected kept shares under pressure.

On Tuesday, Goldman Sachs upgraded Indian shares to “overweight” from “marketweight” and raised its target on the Nifty to 7,600, citing lower external vulnerabilities, and chances of gains ahead of general elections.

Markets this week: BHEL, TCS top Sensex losers

By Sankalp Phartiyal and Ankush Arora

The BSE Sensex ended down 0.7 percent in what was a slow week for Indian shares. The week began with the benchmark index sliding 1.5 percent on Monday as foreign institutional investors (FIIs) continued to sell as part of a slump in emerging markets.

Investor sentiment remained subdued despite a survey on Monday showing that Indian factories started 2014 on a high note, with manufacturing activity growing at its fastest pace in nearly a year as domestic and overseas orders increased.

The remaining four sessions saw the Sensex ending marginally in the green. The benchmark is, however, down 3.7 percent so far this year.

Markets this week: Sensex up marginally, Axis Bank gains 4.7 percent

After registering record closing highs, the BSE Sensex ended with small weekly gains as the index fell sharply on Friday after the RBI governor’s strong comments on inflation dented sentiment.

Raghuram Rajan called inflation a “destructive disease” on Thursday. Earlier in the week, a panel recommended that the RBI should make managing inflation its main policy objective and set monetary policy by committee.

The central bank is likely to keep the repo rate on hold at its policy review next week, a Reuters poll published on Jan. 23 showed.

Markets this week: Sensex up 1.5 percent; BHEL, Infosys jump 5 percent

By Ankush Arora and Aditya Kalra

The BSE Sensex gained 1.5 percent this week, its first weekly gain in 2014, as easing headline inflation data raised hopes the Reserve Bank of India would keep interest rates unchanged at its Jan. 28 meet.

Headline inflation eased to a five-month low of 6.16 percent in December on lower prices of vegetables. This was the slowest pace of growth since July 2013 and below economists’ expectations of 7 percent.

Sentiment was also boosted for the rupee, which rose 0.6 percent during the week to touch a five-week high. However, share losses on Friday weighed on the currency.

Equity funds underperform Sensex for first time since 2008

India’s diversified equity mutual funds rose in 2013 but underperformed the broader markets for the first time in five years, as returns were dampened by the losses in the mid- and small-cap shares as well as financial companies.

These funds gained 4.8 percent on average in 2013, according to data from fund tracker Lipper, delivering lesser annual returns than the benchmark BSE Sensex after 2008.  The Sensex touched life highs in 2013 and ended 9 percent higher, boosted by foreign inflows of more than $20 billion.

Shares of smaller companies, however, underperformed, with the BSE mid-cap index falling 5.7 percent and the small-cap index sliding 11.2 percent. Waqar Naqvi, chief executive at Taurus Mutual Fund, said the sharp fall in mid- and small-cap stocks came as a surprise in 2013.

Markets this week: Sensex falls 1.3 percent, BHEL slumps nearly 10 percent

By Ankush Arora and Aditya Kalra

The BSE Sensex fell 1.3 percent in the week ending Dec. 13 after high retail inflation raised fears of a rate hike. Eight of 10 analysts in a poll on Friday said they expected the central bank to raise the repo rate by 25 basis points to try and tame stubbornly high inflation.

Before falling for four consecutive sessions from Tuesday, markets touched life highs on Monday. The BSE Sensex touched 21483.74 after sentiment on the street was boosted by the Bharatiya Janata Party’s win in three of five state elections.

However, profit-taking and the cautious outlook of investors before Thursday’s inflation data pushed shares lower, with the Sensex registering its worst weekly performance in nearly a month.

Equity funds outperform in November; smaller shares rise

India’s diversified equity funds bucked the trend in the broader markets to eke out gains in November, as a strong performance by mid- and small-cap shares and sectors such as capital goods supported unit values.

Data from fund tracker Lipper, a Thomson Reuters company, showed that such funds rose only 0.21 percent on average in the month, but outperformed the 30-share BSE Sensex that fell 1.8 percent.

Mahesh Patil of Birla Sun Life Asset Management cited the outperformance of mid- and small-cap stocks as the “main reason” for positive returns generated by diversified equity funds in November.

Sesa Sterlite, Bajaj Auto top Sensex losers this week

The BSE Sensex posted a third consecutive weekly fall, closing nearly 1 percent lower amid persisting worries over the slowdown in foreign investors’ buying into Indian shares.

Data shows FIIs sold shares worth $9.5 million on Thursday, snapping a 32-day buying streak as minutes from the last U.S. Federal Reserve meeting showed a decision on tapering its bond-buying programme may be taken at one of its next few meetings.

In the coming week, investors will keep an eye on July-September GDP data and fiscal deficit numbers for the April-October period. Here are the top Sensex losers and gainers of the week:

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