The uptrend in the Sensex and the Nifty continued with marginal gains in the last week. Positive macroeconomic data of manufacturing and inflation helped Sensex and Nifty to consolidate in the last week. Speculation that Fed would hold interest rates in December 2015 due to global economic slowdown also contributed to buying by FIIs.
Growth in industrial production (IIP) hit its highest level in almost three years on the back a surge in the output of the manufacturing sector. Gems and jewellery and rubber insulated cables contributed to more than half of the 6.4% increase in industrial production in August 2015.
Inflation based on the consumer price index (CPI) increased to 4.4% in September 2015 from with 3.7% in August 2015 mainly due to increase in vegetable prices. The core CPI inflation rose to 4.5% in September 2015 from 4.15% in August 2015. Inflation based on the wholesale price index (WPI) was reported at -4.54% for September 2015 as compared to -4.95% in August 2015.
India’s merchandise exports declined 24.3% to USD 21.85 billion in September 2015 over September 2014. Imports declined 25.4% to USD 32.32 billion. The trade deficit narrowed 27.6% to USD 10.5 billion in September 2015 from USD 14.47 billion in September 2014.
Portfolio and Sector Performance
Our model Twelve Stock Retirement Portfolio has given one-year returns of 22.47% and has outperformed the benchmark Sensex by 20.07%.
On a weekly basis, twelve stock portfolio has gained 5.42% in value and the Benchmark BSE Sensex has gained by 0.5%. The Portfolio has outperformed the benchmark by 4.92%.
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On a weekly basis, Global Ten Stock Model Retirement Portfolio has gained 0.07% in value and the Benchmark S&P 500 has gained by 0.9%. The Portfolio has underperformed the benchmark by 0.84%.
Industry and Stock Specific trends
The sectoral indices closed in positive territory last week. The S&P BSE Bankex, Auto, PSU and Oil and Gas indices rose 2.52%, 3.17%, 1.51% and 2.39% respectively in the last week. S&P BSE IT index declined 3.04% in the last week.
Stock Gainers and Losers
Tata Motors stock rose 9% in the last week. The company said that its global wholesales, including Jaguar Land Rover rose 21% at 97,102 units in September 2015 over September 2014.
Reliance Industries stock rose 3% in the last week as the company has delivered above expectations with its September quarter standalone net profit rising 3.8% sequentially to Rs.65.61 billion driven by strong operational performance in refining business. Revenue during July-September quarter stood at Rs.608.17 billion compared to Rs.658.17 billion in April-June quarter of current financial year 2015-16. Gross refining margin (GRM) was the highest in last seven years, coming in at USD 10.6 a barrel during the quarter against USD 10.4 a barrel in the preceding quarter.
Hindustan Unilever stock declined 4% in the last week. HUL’s net profit before exceptional item rose 1.4% to Rs.9.7031 billion in Q2 September 2015 over Q2 September 2014. Net sales rose 4.7% to Rs.78.1964 billion in Q2 September 2015 over Q2 September 2014. Net sales of the domestic consumer business rose 5.1%. Volume growth of domestic consumer business stood at 7%. HUL said that the phasing out of excise duty incentives and fall in product prices adversely impacted the company’s performance in Q2 September 2015. The company reduced product prices in a bid to pass on the benefit of lower commodity costs to consumers.
The derivative market saw fall in open interest in Nifty futures by 4.36%. Nifty at the money call and put option volatility declined last week.
The Rupee appreciated marginally in the last week against the USD. FIIs were net equity buyers to the tune of USD 191 million in the third week of October 2015.