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May 21, 2005

Markets recover on week 3. Sensex gains 48 points

Lower volumes, positive breadth stocks extend hat-trick rally

Weekly statistics

Indices	Open	High	Low	Close	Change
BSE - 30	6456	6568	6380	6499	47.96
BSE - 200	856	869	846	857	01.17
NSE - 50	1991	2024	1964	1992	04.10
Dow Jones	10472  332	Nasdaq	2046 70	FTSE	4972 85
Advances	8942	Declines	7210	Put / Call trades - 122109 : 153696
FII Investments	Rs  527 Crs May 1 - 19		Domestic Funds	Rs  2552 Crs May 1 - 19

The BSE & NSE combined weekly value of shares advancing was Rs. 18,612 crores ( previous week Rs 20,815 crs ) and the commensurate value of shares declining was Rs. 13,005 crores ( previous week Rs 12,966 crs ). This indicates a buying bias. The total weekly traded volume on the BSE was Rs. 10,636 Crores ( previous week Rs 11,685 crs ). The total traded weekly volume on the NSE was Rs. 21,257 Crores ( previous week Rs 22,462 crs ).

The markets continued to surge ahead on a week-on-week basis, though the tempo of the upmove was seen slackening significantly. Had it not been for the big upmoves on Monday and Thursday, the week would have ended with major losses. The sentiments were optimistic and the traded volumes were marginally lower. The positive market breadth imbibes confidence and raises hopes of a bullish undertone in the markets. The Sensex was boosted by Bajaj Auto, BHEL, Dr Reddy, HDFC Bank, Hero Honda, ITC, ICICI Bank, Infosys, L&T, MTNL, Maruti, Satyam Computers, SBI and Wipro. The Sensex was dragged down by ACC, Cipla, Grasim, Guj Amb Cements, Hindalco, Hind Lever, HPCL, HDFC, ONGC, Ranbaxy, Reliance Energy, Reliance Inds, Tisco, Tata Power and Zee Telefilms. The Rupee ended the week at 43.46 levels ( 00.03 ) 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 lower at US $ 46.80 / barrel ( previous week US $ 48.67 / barrel ). That is the single largest positive trigger for the markets.

• The FII inflows are negative by Rs 637 Crs for this week between Mon - Thurs. This factor is likely to remain a cause for concern as FII's remain constant sellers in the Indian equity markets.

• The F&O indicators point towards a 6 % increase in net long positions and that too on higher volumes. The Nifty PCR has gone up from 1.30 : 1 to 1.36 : 1.

• Inflation figure of 5.61 % is lower than the previous weeks figure of 5.67 %. This is a positive indicator.

• The market breadth points towards an optimistic undertone. Of the entire traded volumes of the week, 70 % was initiated on uptick days. That signifies a bullish bias for now.

• The overseas markets have been quite firm on better than expected economic data, corporate earnings and most importantly - lower crude oil prices. That is likely to have a trickle down effect on the domestic sentiments also.

• For a broader view on the markets, please refer to our special editions on crude, currencies, commodities, midcaps, f&o and swing reversal indicators.

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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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