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March 12, 2005

Markets hit speed breaker. Sensex gains 4 points

Higher volumes, negative breadth as profit sales cap gains

Weekly statistics

Indices	Open	High	Low	Close	Change
BSE - 30	6863	6954	6838	6853	04.25
BSE - 200	921	934	915	922	03.66
NSE - 50	2148	2183	2141	2154	05.85
Dow Jones	10774 166	Nasdaq	2042  29	FTSE	4982 54
Advances	7582	Declines	8557	Put / Call trades - 63471 : 130684
FII Investments	Rs  5222 Crs Mar 1 - 10		Domestic Funds	Rs  416 Crs Mar 1 - 10

The BSE & NSE combined weekly value of shares advancing was Rs. 23,859 crores ( previous week Rs 30,558 crs ) and the commensurate value of shares declining was Rs. 18,070 crores ( previous week Rs 12,029 crs ). This indicates a marginal selling bias. The total weekly traded volume on the BSE was Rs. 14,371 Crores ( previous week Rs 13,922 crs ). The total traded weekly volume on the NSE was Rs. 28,027 Crores ( previous week Rs 28,901 crs ).

The week saw a profit taking bias in the markets as the bulls preferred to lock in gains. The fact that the markets were in virgin territory increased the sense of nervousness in the undertone. The traded volumes were marginally lower and the market breadth was expectedly negative. The Sensex was boosted by Bajaj Auto, Cipla, Dr Reddy, HDFC, HDFC Bank, Hero Honda, Hindalco, MTNL, ONGC, Ranbaxy, Reliance Energy, Reliance Inds, Satyam Computers, SBI and Tisco. The Sensex was dragged down by ACC, Bharti Tele, BHEL, Grasim, Guj Amb Cements, Hind Lever, HPCL, ICICI Bank, Infosys, ITC, L&T, Maruti, Telco, Tata Power, Wipro and Zee Telefilms. The Rupee ended the week at 43.57 levels ( 00.16 ) 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 this weekend at US $ 54.43 / barrel ( previous week US $ 53.78 / barrel ) which is likely to fuel inflationary concerns.

• The FII inflows are continuing unabated with Rs 3,063 Crs being pumped in this week. That is a positive trigger for the bulls.

• The F&O indicators point towards a build up of long positions in stocks but the Nifty PCR has scaled new highs, showing a short selling bias.

• The latest inflation figures show a minor rise which is a minor cause for concern. As pointed out last week, the advance tax and service tax payment will be minor triggers for profit sales.

• The market breadth points towards a weakness in the sentiments, especially at higher levels. Of the entire weekly traded volumes, 61 % were transacted on bullish market days.

• The overseas markets were subdued as the higher crude prices fuelled worries of slower economic recovery.

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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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