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April 09, 2005

Markets sink on bull unwinding. Sensex tanks 125 points

Higher volumes, stagnant breadth bulls lose their nerve

Weekly statistics

Indices	Open	High	Low	Close	Change
BSE - 30	6616	6649	6456	6479	125.50
BSE - 200	884	888	866	869	13.27
NSE - 50	2067	2084	2024	2031	36.45
Dow Jones	10461  57	Nasdaq	1999  15	FTSE	4984  70
Advances	7712	Declines	7866	Put / Call trades - 71464 : 144183
FII Investments	Rs  530 Crs April 1 - 7		Domestic Funds	Rs  225 Crs April 1 - 7

The BSE & NSE combined weekly value of shares advancing was Rs. 15,019 crores ( previous week Rs 20,163 crs ) and the commensurate value of shares declining was Rs. 15,206 crores ( previous week Rs 11,010 crs ). This indicates a marginal selling bias. The total weekly traded volume on the BSE was Rs. 9,201 Crores ( previous week Rs 9,433 crs ). The total traded weekly volume on the NSE was Rs. 21,222 Crores ( previous week Rs 22,296 crs ).

The markets have corrected lower after a blip upwards the previous week. The traded volumes were marginally lower as compared to the previous week and the market breadth is more or less even with the advances almost matching the declines. The undertone has turned distinctly cautious and there is a drift in the sentiments. The Sensex was boosted by Dr Reddy, HPCL, ITC, ONGC and Zee Telefilms. The Sensex was dragged down by ACC, Bajaj Auto, Bharti tele, BHEL, Cipla, Grasim, Guj Ambuja Cements, HDFC Bank, Hero Honda, Hindalco, Hind Lever, HDFC, Infosys, L&T, MTNL, Maruti, Ranbaxy, Reliance Energy, Reliance Inds, Satyam Computers, SBI, Tisco, Tata Motors, Tata Power and Wipro. The Rupee ended the week at 43.77 levels ( 00.02 ) against the US $.  Overall, the week was completely in line with our expectations. Click here to view the previous weeks report.

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• The markets are likely to take note of crude prices which are sharply lower at US $ 53.35 / barrel ( previous week US $ 57.27 / barrel ). This will ease inflation concerns in the economy.

• The FII inflows are continuing to remain positive as the figures this week ( Mon - Thu ) totalled Rs 502 Crs. That is likely to be a minor comfort for the bulls.

• The F&O indicators point towards a marginal increase in short positions and a 5 % increase in open interest.

• The market breadth points towards an even force between the bulls and bears as the weekly advance decline figures indicate above. Of the entire week's traded volumes initiated on both the exchanges, 62 % were initiated on positive market breadth days.

• The latest inflation figures show a marginal fall to 5.05 % as compared to the 5.11 % mark announced over the previous week.

• The overseas markets have been bouyant on falling crude prices and the impeding earnings announcements. That may arrest the falls in the domestic markets to a degree.

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Technicals

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For stock specific recommendations please refer to our special edition " Flavours of the week". Click here to view the previous editions of the "Flavours of the week".

Have a profitable day.

 

Vijay L Bhambwani

Ceo :- Bsplindia.com

The author is a Mumbai based investment consultant and invites feedback at Vijay@BSPLindia.com and ( 022 ) 23438482 / 23400345.

SEBI disclosure -  The author has no positions in  the stocks mentioned above.

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