Receding fears of war with Syria led to cooling of oil prices that in turn led to strengthening of rupee against the global currencies. Rupee also gained strength as FIIs continued to buy Indian shares after newly appointed RBI governor Raghuram Rajan charted out plans to get the country out of its current mess. Sensex gained 2.4%, Nifty gained 3.0% and CNX Midcap was up by 3.4% this week.
Monday – Markets closed on occasion of Ganesh Chaturthi
Tuesday - Sensex up by 3.8%, Nifty up by 3.8%, Midcap up by 1.8%
Markets remained buoyant from last week sentiment boost they received from Raghuram Rajan appointment and his maiden speech as RBI governor. Global markets also took respite from the news that Russia has persuaded Syria to put its chemical weapons under international inspection, which worked to shelve the fears of US strike on Syria and led to global rally in stocks.
Telecoms were the major gainers today as TRAI reduced the base price by 37%, from Rs. 2,379cr to Rs. 1,496cr per MHz of pan India spectrum. TRAI also recommended that a flat spectrum usage (SUC) of 3% of gross revenue from 2-8% earlier. Telecom companies are expected to save around 60-80,000cr over a 20-year period.
Wednesday - Sensex up by 0.0%, Nifty up by 0.3%, Midcap up by 1.6%
Markets opened lower as some investors rushed to book profits after previous day’s rally, which was biggest gain in Sensex in four years. Market recouped its losses as day progressed as tension over Syria eased leading to cooling of oil price momentum. Also, consistent recovery in rupee is helping boost the Indian investor sentiment.
Thursday – Sensex down by 1.1%, Nifty down by 1.1%, Midcap down by 0.7%
Investors turned a little cautious and booked profits ahead of IIP and CPI inflation data release expected on Friday.
Friday – Sensex down by 0.2%, Nifty down by 0.0%, Midcap up by 0.7%
Stocks tumbled after PM’s economic panel raised its doubt over Govt. achieving its fiscal deficit target of 4.8% of GDP in current year. Investors also continued to cut positions ahead of US Fed meeting and RBI first meeting under Rajan next week. Market is keenly awaiting Fed’s decision on tapering and RBI’s response to it.
Bulls did get some respite in form of better-than-expected July 2013 IIP data (+2.6% yoy) and fall in retail inflation to 9.52% in August from 9.64% in July. August WPI data, an anchor used by RBI to decide on its policy decisions, will release on Monday.