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25
November 2016
I
had mentioned in last week’s closing report that Nifty,
Sensex were likely to remain under pressure. The major indices of the Indian
stock markets showed a lot of volatility and closed with small gains for the
week. On Monday, the markets opened the week with a loss of 1.80% showing
weakness and closed the week on Friday with a gain of 1.87% showing strength.
The trends of the major indices in the course of the week’s trading are given
in the table below: The Total
Investment & Insurance Solutions
 |
| Weekend Indices (The Total Investment & Insurance Solutions) |
The Indian equity markets plunged to
their lowest levels in the last six months on Monday with the benchmark Sensex
receding below the 26,000-point mark and the NSE Nifty crashing below the 8,000
level. Besides, political bickering over the demonetisation move, depreciation
in rupee, continuous outflow of foreign funds and impasse between the central
and state governments on the contours of the Goods and Services Tax (GST)
framework depressed the buying sentiments.
The global and domestic investors
were jittery on the prospects of a US rate hike which can potentially lead
foreign portfolio investors (FPI) and funds away from emerging markets such as
India. It will also dent the business margins of corporate sector, as access to
capital from the US will become more expensive. The Total Investment
& Insurance Solutions
Gold crawled higher in Asian trade
on Monday, snapping a 3-session losing streak, helped by physical buying after
the metal slid to a 5.5 month low on Friday. Bullion has also been pressured by
talk of an interest rate hike in December by the Federal Reserve.
Indian shares on Tuesday bounced
back from six-month lows hit in the previous session, led by IT (information
technology) and auto stocks, with sentiment turning positive as Asian shares
rallied after all three major U.S. stock indexes hit record highs. Markets made
an attempt to regain the crucial psychological level of 8,000 today and closed
just 2 points above at 8,002.30.
IT, banking, pharma, auto, oil-gas,
textile and aviation stocks traded firm on buying support. Media-entertainment,
FMCG and power stocks traded with mixed sentiments due to short covering, while
cement stocks traded firm on buying support.
Investors betting that Donald
Trump will roll back regulations and taxes while pumping money into
infrastructure projects drove the Russell 2000 index of small-capitalization
stocks to a record with its 12th straight session of gains, its longest winning
streak since June 2003. The index has risen 11% since Election Day, outpacing
the S&P 500’s 2.7% climb. The Indian rupee weakened by 10 paise to
68.26 against a US dollar from its previous close of 68.16 to a greenback. The Total Investment
& Insurance Solutions
Indian shares extended gains for a
second day on Wednesday led by a gauge of capital goods companies, which
snapped its biggest losing streak since January. The Indian currency fell 0.3%
to 68.5 against the dollar, its lowest level since February. The rupee’s slide
toward a record low, amid $2.8 billion in outflows from Indian stocks and
bonds, prompted speculation the central bank will step up intervention to stem
losses.
Equity benchmarks snapped their
two-day winning streak on Thursday with the Nifty closing below the 8,000 level
amid consistent weakness in rupee and expiry of November derivative contracts.
Continued disruption in Rajya Sabha by opposition parties over demonetisation
also dented market sentiment. Pandemonium over the demonetisation decision
continued.
The rupee fell to its record low
level of 68.862 during the intraday trade on Thursday on account of buying of
the US dollar by the banks and importers. The domestic currency has fallen
around 4% since the demonetisation of higher currency notes by Prime Minister
Narendra Modi on November 8. The Total Investment & Insurance
Solutions
On Friday, the key Indian indices
provisionally closed the day's trade with gains of more than 1.5% each, as
buying was witnessed in IT, healthcare and banking stocks. Hong Kong stocks
notched up their biggest weekly gain in nearly two months, supported by a rally
in the Chinese financial sector driven by a rebound in insurance stocks.The Total Investment
& Insurance Solutions
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