Porisma Pompi Gogoi says global cues, macro-data dragged key equity indices lower
Negative global cues, profit booking and mixed macro-economic data saw two key Indian equity market indices end in the negative territory during the week ended Friday. The markets, which started the week on a flat-to-negative note, resumed the uptrend post the accommodative monetary policy stance of the Reserve Bank of India (RBI). The investors’ risk-taking appetite also climbed on expectations of the onset of south west monsoons.
However, later in the week, gains were capped as investors’ sentiments turned cautious with the global markets turning weak ahead of the Federal Open Market Committee rate decisions and a weak rupee, analysts said.
Consequently, the 51-scrip Nifty of the National Stock Exchange (NSE) was down 50.75 points or 0.62 per cent at 8,170.05 points, while the 30-scrip sensitive index (Sensex) of the BSE lost 207.28 points or 0.77 per cent at 26,635.75 points.
“Over the last one week, markets have been languidly moving up, devoid of any sharp movements. While the week was filled with news flows, market participants decided to take most developments in their stride,” said Brijesh Ved, Senior Portfolio Manager, BNP Paribas.
“Markets were cheered by the statements of the RBI Governor, Raghuram Rajan when he said that the central bank will monitor macroeconomic and financial developments for scope for reduction in the repo rate,” said Ved.
“RBI retained its March 2017 inflation projection of 7m per cent while at the same time pointing out some upside risks to inflation such as firming international commodity prices and the implementation of the 7th Central Pay Commission awards,” he added.
“A curb in the global growth outlook by the World Bank and consensus that retail inflation in May can increase to 5.6 per cent, versus 5.39 per cent in April, compelled investors to stay cautious in Dalal Street,” said Vinod Nair, Head of Research for the brokerage.
Among the sector-specific indices of the BSE, the realty index declined 1.03 per cent, auto lost 0.95 per cent, consumer durables was down 0.71 per cent, and oil and gas fell 0.69 per cent. On the other hand, power was up 0.60 per cent, utilities was up 0.27 per cent and basic materials was up 0.09 per cent.
Among the individual stocks that go into the Sensex basket, State Bank of India wae top gainer with 4.94 per cent, followed by BHEL (up 4.83 per cent), ICICI Bank (up 3.69 per cent), Oiland Natural Gas Corp (up 2.90 per cent) and Cipla (up 2.40 per cent).
The losers were led by Infosys, down 6.76per cent), followed by Asian Paints (down 3.31 per cent), Dr. Reddy’s Labs (down 3.00 per cent), Tata Consultancy (down 2.66 per cent) and Maruti Suzuki (down (2.43 per cent).
The week also saw appreciable inflows of foreign funds.
As per official data, foreign funds purchased net stocks worth Rs 1,492.71 crore during the week under review, while domestic institutional investors sold scrips worth Rs 925.42 crore.
Figures from the National Securities Depository Ltd showed that foreign portfolio investors were net buyers of equities worth Rs 2,501.11 crore, or $373.11 million from June 6-10.