The Sensex and the Nifty rose 1.53% and 1.72% respectively last week on the back of expectations of the US Federal Reserve (Fed) postponing tapering of asset purchases. FIIs bought USD 600 million of Indian equities last week on the back of the lifting of the US debt ceiling and the US Government ending the partial shutdown. The US government has not resolved its budget differences and until it does so the Fed will continue to buy USD 85 billion of securities every month.
The US Government extended the debt ceiling that will fund the spending till 15th January 2014 and ended the partial shutdown. The Dow Jones Industrial Average rose 1.07% and the NASDAQ increased 3.22% on relief of the government averting a potential default on its debt.
The Euro appreciated 1.03% against the USD to reach USD 1.368 per Euro and the Japanese Yen rose 0.87% to Yen 97.72 per USD. The USD index fell to 79.61 last week against 80.41 that was seen in the week previous to last. Crude oil prices declined 1.15% to USD 110 /bbl and gold prices rose 3.46% to USD 1316 /Oz on a week on week basis.
The third quarter GDP growth was reported at 7.8% compared to a growth of 7.5% in the previous quarter for China. Accelerated growth in the Chinese economy is expected to be a positive factor for the emerging market economies.
The equity derivatives market saw rise in open interest in Nifty Index futures by 5.52% while implied volatility of Nifty index options decreased week on week. FIIs were net buyers to the tune of Rs.3716 crores in the equity market in the last week. Domestic Institutional Investors were net sellers to the tune of Rs.3388 crores in the equity market in the last week.
Industry and Stock Specific trends
The Index of Industrial Production (IIP) reported 0.6% growth for the month of August 2013 against a 2.8% growth for the month of August 2012 on a year on year basis. Manufacturing segment reported a 0.1% decline for the month of August 2013 against a 3.2% growth for the month of August 2012 on a year on year basis. Capital Goods segment reported a decline of 2% in the month of August 2013 against a 15.6% growth for the month of August 2012 on a year on year basis.
The sectoral indices gained last week with only the S&P BSE Auto index closing negative with a -0.24% decline on a week on week basis. S&P BSE Bankex, IT, PSU and Oil and Gas indices increased 1.37%, 0.38%, 0.71% and 3.40% respectively in the last week.
TCS stock rose to Rs.2120 as the company reported a 24% growth in the net profit on a sequential quarter basis to Rs.4702 crores for Q2FY14. The revenues grew 16.6% on a quarter on quarter driven by volume growth of 7.3%.
HCL Technologies reported an increase of 31.2% year on year and 14% quarter on quarter in the net profit to Rs.1416 crores for the quarter ended September 2013. The stock rose to Rs.1103 in the last week.
Bharti Airtel stock rose 6.59% to Rs.357 as the company completed the acquisition of Wireless Business Services which holds Broadband Wireless Access spectrum in the Indian telecom circles.
Reliance Industries stock rose 4.9% to Rs.905 as the company reported a 1.5% increase in net profit to Rs.5490 crores on a 14.2% growth in the revenues on a year on year basis for Q2FY14.
ONGC stock rose 2.75% to Rs.283 as the company signed an initial pact with Finland based biotechnology company Chempolis to build a refinery in India using biomass as a feedstock.
HDFC Bank stock rose 2.46% to Rs.676 as the bank reported a 27.70% increase in net profit to Rs.1982 crores on a 17.65% increase in revenues on a year on year basis for Q2FY14.
Bajaj Auto stock rose 0.61% to Rs.2153 as the company reported a rise in net profit by 13% to Rs.837 crores with a 3% growth in revenues on a year on year basis for Q2FY14.
Table 1. Weekly Market Movement
Table 2. Weekly Gainers and Losers