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Weekly wrap: Fed saves blushes for Nifty, Sensex; broader markets mixed

18:47

Federal Reserve’s assurance that it would take a ‘patient’ approach to interest rate hike, gave a much needed boost to stock markets globally.

This propelled Asian stocks to log their highest gains in months, on Friday, following US market which closed at their highest levels since 2011.

Assuaging concerns over the timing of imminent interest rates hike, US Federal Reserve Chair Janet Yellen said interest rates would be kept unchanged for “at least a couple of meetings”. This means April in 2015, at earliest. 

Geoffrey Dennis, Head of Global EM Strategy at UBS, in an interview with CNBC-TV18’s Latha Venkatesh, said that the global sell-off is over for the time being and there could be a relief rally towards the end of this month.

“We would certainly be a buyer of India at this point. We are overweight India in our global emerging market portfolio. I think you had the sell-off in India in context of what’s going on in the global markets,” he added.

Market Internals

Market hit a low point during the week owing to weak global cues and dismal trade deficit figures. Trade deficit figures for the month of November swelled to one-and-a-half year high of $ 16.86 billion tripping rupee to one year lows of 63.59, on Tuesday. The currency however recouped earlier losses later in the week on back of strong inflows. The rupee was last seen trading at 63.29 against the USD.

In the cash segment, FIIs provisionally sold stocks worth Rs 4,838.86 crore in the week ended 19 December 2014, according to SEBI data. Domestic investors on the other hand invested Rs 2,742.62.

Both Sensex and Nifty ended flat while broader markets ended on a mixed note. The CNX mid-cap index was flat while BSE small-cap index scrapped 1.3 percent.

Among Nifty stocks, gains in Zee Ent (up 5.5 percent), HCL Tech (up 5 percent), BHEL (Up 4.5 percent), HDFC (Up 4 percent) and ONGC (up 3.7 percent) were offset by losses in DLF (down 13 percent, ITC (down 7 percent), HUL (down 6 percent), Asian Paints (down 5.6 percent) and DRL (down 5.3 percent).

From mid-caps, Mastek, Jindal Photo, JK Tyre, Marksans Pharma, Gujarat Gas and JP Infra gained between 14-39 percent.

Gains in sectors were led by software stocks as weakness in rupee brightens the outlook for the export-led industry;

BSE IT index surged 2.3 percent. The sentiment further improved after Accenture raised its revenue forecast for fiscal 2015. HCL Tech and Infosys surged 2.5-4.5 percent. 

Bank Nifty too swelled 1.9 percent; ICICI Bank and Yes Bank were up 2-3 percent. 

Oil & gas index swelled 1.7 percent on a weekly basis as brent crude futures recovered from its multi-year lows after Saudi Arabia’s oil minister said he is optimistic about global oil demand in future.

BSE Capital goods index was up over 1 percent; Crompton Greaves rose almost 1 percent after RBI allowed FIIs to invest up to 100% of the paid up capital of the company. Punj Lloyd surged 3 percent as the company got FIPB approval to enter the defence sector.

Among stocks that hogged the limelight this week, Spicejet rallied almost 5 percent as after reports suggested that former promoter and some other investors are willing to pump in Rs 1200 crore in the ailing airline.

Week ahead

It’s a truncated week ahead on account of Christmas on Thursday. The market is expected to remain volatile owing to December series derivatives expiry on Wednesday.

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