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Sunday, April 3, 2011

Weekly-market: FIIs propel markets to new highs this week

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April 01, 2011
 Market Commentary 
FIIs propel markets to new highs this week 
The Indian markets outperform its global counterparts and log second straight weekly gains on robust buying by FIIs 

Major news for the week:
  • Food inflation softens to 9.5% versus 10.05%
  • February exports rise 49.7%
  • FDI down by 30% in February to $1.2 billion
  • Maruti Suzuki March sales up 28% yoy
  • SBI extends teaser home loan scheme by a month 

Indian indices
The Indian markets maintained its uptrend for the second week in a row. Strong buying by foreign institutional investors (FIIs) played a major role in boosting the markets. Positive global cues and a decline in food inflation provided further support. The markets witnessed good rollovers on March F&O expiry day. The key indices attained new highs this week on the back of robust FIIs, with the Sensex crossing 19400 levels and the Nifty above the 5800 mark.

The Sensex fluctuated around 775 points between a high of 19575 and a low of 18800 and closed the week at 19420, higher by 605 points or 3.21%. The Nifty swung about 229 points and ended the week at 5826, up 172 points or 3.04%.

Global indices
The global sentiments remained upbeat. All the world markets closed the week higher. However, Shanghai Composite was the only loser, down by 0.36% on renewed concern about further monetary-policy tightening by the country's central bank. The Sensex outperformed its global peers this week, rising by 3.21%. Following that Hang Seng rose by 2.78% and Nikkei gained by 1.81%. Other global indices gained in the range of 0.14 - 1.39%.

Sectoral and stock screening
All the sectoral indices closed the week on a strong note. BSE Realty stood the top gainer for the second consecutive week, surging by 7.15%, following that BSE Consumer Durables (CD) rose by 5.97% and BSE Auto advanced by 5.74%. Rest of the indices ended the week higher in the range of 1.58-3.18%.
On 'A' group stocks' front, top three gainers of the week ? D B Realty shot up by 20.1%, IL&FS Transportation Networks gained by 16.56% and LIC Housing Finance surged by 13.40%. Top three losers of the week - Piramal Healthcare dropped by 12.98%, Tech Mahindra fell by 6.19% and National Aluminium Co slipped by 4.90%.
FII/MF activity
The FIIs were heavy buyers this week and purchased Indian equities worth a net of Rs4,543.4 crore as against net buy of Rs529.4 crore seen in the previous week. The domestic institutional investors (DIIs) sold Indian equities worth a net of Rs364.7 crore as compared to net buy of Rs209.5 crore seen in the previous week. 
Company Price (Rs) % chg
DB Realty
LIC Housing
Piramal Healthcare
Tech Mahindra
Rs (cr)
Gross purchase 13063 1660
Gross sale
Net investment
*As on March 31, 2011
**As on March 30, 2011
Major trigger for the markets in the near term is Q4 March 2011 results, which may keep investor participation high. Crude oil prices will remain a major cause of concern. The FIIs' activity and changes across the globe will provide further course of direction to the Indian markets.
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