Continuing from where they left off last week, the Indian markets maintained their upward momentum during the week gone by. In spite of having just three trading sessions, the BSE-Sensex ended higher by 4.4% over the closing levels of last week (which had four sessions). Other Asian markets such as Japan (up 2.4%), Hong Kong (up 2.4%) and China (up 1%) also ended the week on a positive note. As for other global markets, Barring the UK (down 1.1%), Brazil (up 2.6%), Germany (up 2.4%), US (up 0.8%) and France (up 0.5%) ended on a firm note.
Coming to the performance of sectoral indices in India, stocks forming part of the realty, consumer durables and metal sectors emerged as top gainers during the week. The BSE-Realty and BSE-Metal indices recorded gains of 13.7% and 9.3% respectively. On the other hand, the BSE-FMCG Index (up 1.2%) and the BSE-IT Index (up 1.8%) were the lowest gainers. The BSE Small cap Index was on a roll last week, recording a gain of 9.3%. A handful of stocks recorded gains in excess of 30%.
The past week saw strong buying activity from the foreign institutional investors (FIIs), wherein they pumped in a total of nearly Rs 13.5 bn. For the month of April 2009, the net FII inflow stands at Rs 10.5 bn. However, this is the highest figure recorded during the year. During the months of January, February and March, the net FII inflow / (outflow) stood at Rs (42) bn, Rs (24) bn and Rs 5 bn respectively.
The BSE-Auto index gained 4% during the week. The Society of Indian Automobile Manufacturers (SIAM) has projected that the automobile sector is expected to be back on track and growth would pick up in FY10. As per a SIAM report, passenger and commercial vehicles are expected to grow between 3% to 5% and 7% to 10% respectively. Three wheelers and two wheelers are projected to grow between 0% to 5% and 5% to 8% respectively. This report has got a mixed response from the auto industry. It is believed that some companies are not convinced with the projections, while others are cautiously optimistic.
A leading business daily has reported today that Infosys has fired nearly 2,100 employees on account of non-performance. As per the management, the company has sacked these employees after an annual performance appraisal of nearly 60,000 employees. It may be noted that the company currently has an employee base of nearly 105,000 which include 45,000 trainees. As reported, the trainees were not part of this appraisal exercise.
The communications ministry has decided not to further grant fresh telecom licences. The reason behind the same is to prevent unhealthy competition in an already crowded telecom market. It is believed that the department of telecom received as many as 343 applications after September 25, 2007. However, all those who applied before the date have been given licences.
|Source: Yahoo Finance
||Source: Yahoo Finance
Movers and shakers during the week
||Change from 52-wk High
|Top gainers during the week (BSE-A Group)
||300 / 54
||375 / 70
||179 / 36
||409 / 82
|Top losers during the week (BSE-A Group)
||0 / 0
||189 / 86
||74 / 25
Among economic news, inflation (as measured by the wholesale price index) declined to 0.26% for the week ended March 28. This is as against an inflation of 0.31% recorded in the previous week. This drop is mainly on account of lower prices of food items and mineral products. However, items like imported edible oil were dearer by 6%.
India's industrial output fell 1.2% YoY in February compared to a growth of 9.5% YoY in the same month last year. Manufacturing output, which accounts for the bulk of the weight in the overall index, declined 1.4% YoY in February, against 9.6% YoY growth in the same month last year. While mining output also fell 1.6% YoY, that for electricity increased by 0.7% YoY during the month.
In international news, the International Energy Agency has stated that it expects the global oil demand to drop by 2.4 m barrels per day this year. The reason behind the same is lower consumption caused by the global economic slowdown. With this drop in demand, the consumption level is likely to be equal to what it was in 2004. In its report, the agency stated that it expects oil demand to increase by next year itself.
Japan recently unveiled a stimulus package worth US$ 150 bn to turn around its economy. It may be noted that this is the largest-ever stimulus for a single extra budget and is equivalent to nearly 3% of the country's GDP. This has been proposed mainly to help the economy from further deterioration.