Lull after the storm? Markets see first weekly loss in a month

May 31 2014, 12:25 IST
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The market is seen taking a breather as the Street awaits confirmed policy reforms from the Narendra Modi government. The market is seen taking a breather as the Street awaits confirmed policy reforms from the Narendra Modi government.
SummaryOn Friday, 30-share BSE Sensex ended flat, lower by 16 points, or 0.07%, to 24,217.

The benchmark indices posted their first weekly fall in four weeks as profit-taking in frontline stocks and moderate selling by overseas investors dragged down indices.

The market is seen taking a breather as the Street awaits confirmed policy reforms from the recently formed government. Some amount of profit-booking was seen during the week in frontline stocks that have participated heavily in the run-up after the announcement of the election results, as reflected in selling by overseas investors in four out of the last five sessions. The RBIís policy review next week is likely to provide fresh cues.

The country's GDP for the fourth quarter of FY14 grew at 4.6% while GDP for the entire FY14 grew at 4.7%, marking a second straight year of sub-5% growth.

On Friday, foreign institutional investors (FIIs) bought shares worth $503.8 million, the highest since May 16, according to provisional BSE data. FIIs bought shares worth $379.5 million this week, taking their monthly purchases to $2.76 billion. Their year to date purchases stand at just over the $8 billion mark.

On Friday, the 30-share BSE Sensex ended flat, lower by 16 points, or 0.07%, to 24217, while the broader 50-share Nifty declined 5.7 points or 0.08% to close at 7,229.

It was a dismal week, with the benchmark indices retreating in three out of five sessions and the BSE Sensex ending lower by 1.9%. BSE Consumer Durables (-6.3%), BSE PSU (-6.5%), BSE Power (-5.2%), BSE Oil&Gas (-5.9) were the major sectoral losers during the week. BSE Healthcare was the major gainer, up 2.4%.

The derivatives expiry of May contracts on Thursday happened with a downward bias, with the premium at which the Nifty June future trades over the spot Nifty contracting from 129.5 on Wednesday to 30.05 on Thursday. May Nifty futures also witnessed a muted rollover of 59.7% to the next series, compared to the general average of about 62%.

Among its peers, most of the Asian markets ended in the red on Friday. Jakarta Composite retreated the most at 1.84% while the Nikkei 225 and Kospi declined by 0.34% and 0.86%, respectively. Among the major European indices, the FTSE 100, the DAX and the CAC were all trading in the red at about 6.30 pm IST, down anywhere between 0.04% and 0.45%. During the week, Nikkei 225 (1.5%) and Taiwan's Taiex (1.15%) were the major gainers, while Jakarta Composite and Kospi were among the major losers, down 0.85% and 0.74%,

respectively.

Back home, 18 of the 30 Sensex stocks ended in the red on Friday. In the broader market, breadth was marginally strong with 1,545 stocks traded on the BSE ending higher compared with 1,442 declines. Most of the 13 BSE sectoral indices ended in the green. The BSE Healthcare and BSE Realty gained more than 2% each. Among the losers, BSE Bankex and BSE Consumer Durables indices declined by 1.6% and 1.8%, respectively.

India VIX, a volatility indicator, declined further on Friday by 2.1% to 16.33, indicating low levels of volatility for the market in the next 30 trading sessions.

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