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July 09, 2005

Markets caught in volatile churn. Sensex gains 1 point

Lower volumes, positive breadth as consolidation sets in

Weekly statistics

Indices	Open	High	Low	Close	Change
BSE - 30	7186	7308	7123	7212	01.31
BSE - 200	925	942	917	930	04.20
NSE - 50	2212	2238	2171	2196	15.70
Midcap 200	3037	3150	3037	3144	110.05
CNX-IT	3051	3095	2958	2999	51.60
NCDEX Agri	1236	1248	1236	1248	13.83
Dow Jones	10449  146	Nasdaq	2113  56	FTSE	5232  71
Advances	9057	Declines	7456	Put / Call trades - 135876 : 178374
FII Investments	Rs  1684 Crs July 1 - 7		Domestic Funds	Rs  321 Crs July 1 - 7

The BSE & NSE combined weekly value of shares advancing was Rs. 29,081 crores ( previous week Rs 31,977 crs ) and the commensurate value of shares declining was Rs. 17,041 crores ( previous week Rs 18,259 crs ). This indicates a marginal selling bias. The total weekly traded volume on the BSE was Rs. 14,763 Crores ( previous week Rs 14,955 crs ). The total traded weekly volume on the NSE was Rs. 31,954 Crores ( previous week Rs 35,483 crs ).

The markets saw the much awaited correction being triggered by the terror attacks in London as the bulls surrendered position in panic. The traded volumes took a slight hit as the retail segment abstained from hectic trading. The market breadth stood out as positive after a few weeks of selling in the mid cap segment. The Reliance group scrips paused for a breather and the undertone was cautiously optimistic. The Sensex was boosted by ACC, Bharti Tele, BHEL, Dr Reddy, Guj Amb Cements, HDFC, HDFC Bank, Hero Honda, Hindalco, ITC, ICICI Bank, L&T, MTNL, NTPC, SBI, Tisco, Telco and Tata Power. The Sensex was dragged down by Bajaj Auto, Cipla, Hind Lever, Infosys, Maruti, ONGC, Ranbaxy, Reliance Energy, Reliance Inds, Satyam Computers, TCS and Wipro. The Rupee ended the week at 43.62 levels ( 00.11 ) 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 higher at US $ 59.63 / barrel ( previous week US $ 58.75 / barrel ). The markets are likely to come to grips with 55 + levels on Nymex crude on a semi permanent basis.

• The FII inflows are continuing to remain positive as the week saw investments of Rs 1370 crs between Mon - Thu. That is likely to be a positive trigger for the bulls.

• The F&O indicators point towards a rise in the Nifty PCR as the bears show increased aggression.

• Inflation figure of 4.14 % as on weekend June 25 2005 is higher than the previous weeks figure of 4.10 %. The higher oil prices are clearly taking their toll.

• The market breadth points towards a bullish undertone as can be seen from the BSE & NSE combined advance decline ratio in the table above. Of the entire traded volumes of the week, 57 % was initiated on uptick days. That signifies a buying bias.

• The overseas markets have seen a bullish bias inspite of the terror attacks and that is a sign of strength. The economic data emanating from the US is positive.

• For a complete perspective on the markets, please refer to our editions - Flavours of the week, Midcap newsletter, Commodities reader and The crude and currency trader.

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Technicals

This segment is for paid subscribers only

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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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