Stock prices seen consolidating during week

Our Markets Bureau

Mumbai, Dec 9: Stock prices are likely to consolidate during the week, but gains are unlikely to be aggressive as witnessed during the week gone by. Some market experts did not rule out a small correction, following a weak close on the Nasdaq and a much needed cool-off after sustained gains witnessed in the last two months.

Tata TD Waterhouse Securities Ltd, head of research, KR Ramachandran said: “Market is likely to consolidate further, but the momentum witnessed last week, might get arrested and be slowed down slightly.”

“The market from hereon might add another 200 points with intra-day correction,” he added.

Analyst Abhay Aima said: “The market from hereon will consolidate gradually, but during the current week, stock prices might take a breather for a fresh rally.” “ We might see a fresh rally in the last week of December,” he added.

Last week, the BSE 30 Sensex gained 148.81 points, or 4.5 per cent to 3,436.37 points, as compared to the week before, with foreign institutional investors (FIIs) having a substantial contribution towards the rally. They were net buyers up to Thursday to the tune of Rs 389 crore, while mutual funds who were net sellers during the last two months, turned buyers in the week gone by.

The rally last week was mainly led by software stocks, with blue-chip IT and media stocks like Infosys Technologies, Wipro, Satyam Computers, Zee Telefilms gaining in the range of 15-30 per cent during the week, while second rung software stocks like HFCL, Global Tele-Systems, Mastek, Aftek Infosys, NIIT, Polaris vaulted in the range of 15-40 per cent.

Arcadia Share & Stock Broker director Anthony Sequiera said, “The undertone remains bullish, but during the week, the market might loose some steam on the back of weak closing at the Nasdaq on Friday and aggravated rally.”

“The trend of the market, finally, will be in the hands of foreign funds during the week,” Mr Sequiera added.

A dealer at a foreign brokerage said, the sharp surge in some of the technology stocks cannot be gauged on percentage rise, as these stocks had spiralled badly on concerns of software exports to US, following the September 21 terrorist attack in the US. When we take the rise in percentage, we should also see the base price from which it has appreciated, he added.