Weekly Market Commentary - Aug 5 - Aug 8, 2013

Rupee decline remain the focus of the week and its continuing slide has caused jitters in the market. Investors are also keeping a close eye on unfolding drama in National Stock Exchange Ltd (NSEL), promoted by Financial Technologies (FTIL), which also owns 26% in MCX, nation’s leading commodity exchange. Sensex and Nifty went down by 2% each, while CNX Midcap gained 0.3% this week.

Monday - Sensex up by 0.1%, Nifty up by 0.1%, Midcap up by 0.3%
Markets pared the early gains made during the day as HSBC survey indicated that private manufacturing activity in the country has contracted for the first time in four years. The HSBC India composite index covers both services and manufacturing activities, declined to 48.4 in July from 50.9 in June. The tough investment climate in the country is taking its toll on business activity as investors are losing confidence in India story.

Tuesday - Sensex down by 2.3%, Nifty down by 2.5%, Midcap down by 2.5%
Sensex went down by 450 points as rupee hit a fresh low of 61.80 against the US dollar. RBI’s rescue plans are looking more like prayers than plan (stole a line from Andy Mukherjee).

Wednesday - Sensex down by 0.4%, Nifty down by 0.4%, Midcap up by 1.3%
Markets continued to weigh down by ongoing slide in rupee value against the dollar. Investors are worried that rupee might hit 64 in the near term and will cause more pain to already weak Indian economy.

Thursday - Sensex up by 0.7%, Nifty up by 0.8%, Midcap up by 1.2%
Indian markets bounced back after recent sell-offs owing to declining rupee value against the dollar. Ranbaxy Laboratories jumped 28% after good showing in US business sales. Maruti jumped 4% after there were news that Indian govt may cut excise duties on vehicles to revive falling demand.

Friday – Eid Holiday