Sep 14, 2013, 02.41 PM | Source:

Nifty surges 3% in week; Axis Bank, Tata Power, L&T up 11%

The Sensex closed at 19732.76, up 2.4 percent over previous week and the Nifty gained 3 percent or 170.2 points at 5850.60 while the broader markets outperformed with the CNX Midcap and BSE Smallcap indices rising more than 3 percent.

Moneycontrol Bureau

The 30-share BSE benchmark gained another 463 points this week on top of a 1035 points rally in previous week, supported largely by inflow of foreign money that pushed the rupee 180 paise up this week as against 46 paise last week.

The rally was largely led by Rajan effect, easing of tensions in Syria and strong Chinese economic data.

Recent rally is not so much to do with domestic factors; it has been largely an emerging markets rally driven more by China, more by the fact that Syria has been pushed back to the backburner because the QE tapering that people have been talking about will be probably more softer than people anticipated previously, says Girish Pai, Independent Analyst.

The Sensex closed at 19732.76, up 2.4 percent over previous week and the Nifty gained 3 percent or 170.2 points at 5850.60 while the broader markets outperformed with the CNX Midcap and BSE Smallcap indices rising more than 3 percent.

BSE Capital Goods index rallied the most this week 8% followed by Bank, Power, Auto, Metal, FMCG and Healthcare with 2-5 percent gains.

Punjab National Bank and DLF were the biggest gainers, rising 14-15 percent and then Axis Bank, Tata Power and L&T with 11 percent rally each.

However, Cairn India, IndusInd Bank, ONGC and ICICI Bank were only losers.

After 1500 points rally in last two weeks, the market is looking for more triggers globally and locally to get direction on either side.

There are two events next week one is FOMC on September 17-18, which is the major event as far as the globe is concerned. Any news on Fed tapering from Ben Bernanke will be closely watched because experts feel the Fed may reduce USD 85 billion monthly bond buying purchases by USD 5-15 billion.

Nick Parsons of National Australia Bank believes the Federal Reserve will begin with a very modest tapering of around USD 5-10 billion per month and its continuance will be data dependent.

"There will still be some flexibility (in tapering) going forward and the markets could quite easily cope up with that, in fact, they would welcome such a move," Parsons says in an interview to CNBC-TV18.

The second event is the RBI policy scheduled on September 20. It will be the first policy from new RBI governor Raghuram Rajan. People has been seeing him as a game changer and the expectations have mounted from his first policy after he started his first day on September 5 with slew of measures to revive economy and moderate banking system.

Whether the policy will be growth or inflation oriented will be closely watched by the market.

Indranil Sengupta of Bank of America Merrill Lynch feels the RBI will continue with the status quo on September 20 unless the Federal Reserve defers tapering or the markets demonstrate that tapering is priced in.

He expects the July 15 tightening measures to be rolled back in December if the FCNRB deposit-cum-swap scheme nets USD 10 billion by November 30.

Meanwhile, Deven Choksey, MD of KR Choksey Securities says that the market would remain rangebound and cautious next week.

According to him, the market could see the Nifty trading in a range of somewhere around 5,650-5,700 on the downside and 5,850-5,900 on the upside.

After more than 1700 points rally on measures announced by Raghuram Rajan and rupee appreciation, the market remained rangebound in last three sessions as it seemed to be eagerly waiting for FOMC meet that is scheduled for September 17-18 and RBI policy on September 20.

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The market seems to ignore the big political move in which BJP is likely to put forth Modi as PM candidate in the upcoming election. Deven Choksey, MD of KR Choksey Securities says, "I think the market could give thumbs up only after the formal announcement takes place. Second it is not only the naming of the PM."

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The market remained lacklustre in afternoon trade, continuing its consolidation for the second consecutive session after a 1762 points rally on the Sensex in previous four sessions.

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IT, FMCG and cosumer durable stocks are very weak. Wipro, Bharti, Airtel, Tata Steel, ITC and Infosys are top losers in the Sensex. Gainers in the Sensex include BHEL, Hero MotoCorp, Coal India, M&M and Tata Power.

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Power stocks are also in bull grip with the Tata Power rising 2 percent as Central Electricity Regulatory Commission (CERC) is likely to decide compensatory tariff rate today Mundra Plant.

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The market is volatile with negative bias. The Sensex is down 87.40 points or 0.44 percent at 19694.48, and the Nifty loses 24.35 points or 0.42 percent at 5826.35. About 1046 shares have advanced, 623 shares declined, and 105 shares are unchanged.

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The Sensex is up 37.92 points at 19819.80, and the Nifty is up 10.50 points at 5861.20, but the broader markets have outperformed equity benchmarks with the BSE Midcap and Smallcap indices gaining 0.6 percent each.

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READ MORE ON  BSE Sensex, Nifty, Market, RBI, FOMC


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