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Weekly wrap: Global cues drag Sensex, Nifty 1%; DIIs remain confident

17:34

Equity benchmarks Sensex and Nifty shed 1-2-1.4 percent for the week, weighed down by Tuesday’s crash over Greece and crude worries. The possibility of Greece exiting the European Union and crude oil slipping below USD 50-a-barrel led to a global sell-off on Tuesday.

Broader markets performed relatively better as compared to benchmark indices; BSE small-cap and CNX Mid-cap slipped a little less than 1 percent. Core Education, Intellect Design, Pipavav Defence, OnMobile Global, Videocon, GIC Housing, Brigade Ent and TVS Motor gained 10-41 percent.
 
Provisional data shows FIIs as having sold stocks worth Rs 2,638.72 crore this week owing to a risk-off sentient amid subdued global cues.

The possibility of Greece exiting the European Union and crude oil slipping below USD 50-a-barell led to a global sell-off on Tuesday. Greece exiting the European Union or “Grexit’ will significantly hurt the region’s common currency -Euro- and will increase the possibility of sovereign default by the country. 

A crash of 857 points on Sensex on Tuesday had market worried if the bullish trend has reversed. Experts feel these concerns may be exaggerated and recommend that investors should dips as buying opportunities.

UR Bhatt of Dalton Capital sees pressure on crude prices hurting the sentiment internationally but India’s macro fundamentals appear sound. “I don’t think this (correction) will last long,”

Adrian Mowat of JP Morgan in a conversation with CNBC-TV18 earlier this week said, “I think the return of around 20 percent is quite reasonable out of India” 

Domestic institutional investors remain unperturbed by the global sell-off and continued their buying spree; stocks worth Rs 1504.19 crore were bought by local investors this week.

Market Internals

Metal, banking and power stocks were the top losers among sectors; NMDC, BHEL, Sesa Sterlite, JSPL, PNB, ICICI Bank, HDFC, Tata Power and SBI were off 4-8 percent, faring among top Nifty losers.

BSE FMCG and IT indices emerged in the green on back of HUL stock being upgraded by brokerages and good Infosys Q3 results respectively. 

HUL, Kotak Mahindra Bank, BPCL, Asian  Paints, Maruti Suzuki, Infosys and Tech Mahindra rallied 2.8-14.6 percent and emerged among top Nifty performing Nifty stocks this week. 

HUL stock rallied 14 percent after a spate of upgrades from top foreign brokerages. Credit Suisse and Deutsche Bank raised their target price on the stock to 915 & 900 respectively.

Kotak Mahindra Bank hoisted 7.2 percent after getting a shareholder nod for merger of ING Vysya Bank with itself.

Infosys stock which gained 3 percent during the week posted a 5 percent growth in third quarter consolidated net profit to Rs 3250 crore and a 3.4 percent increase in revenue compared to previous quarter. The management has maintained its guidance at 7-9 percent for FY15, which propelled the stock up 5 percent.

Week ahead

Despite a smart recovery led by short-covering this week, market experts of the view that needs to breach the 8450 level to resume the bull-run.

Third quarter corporate earnings results, crude oil price movement, US jobs data which is slated to be released later today will dictate the trend in the short-term.

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