Weekly roundup: Sensex, Nifty scale new peaks on FII buying

Markets ignored the anxiety caused by the geopolitical tension over Ukraine and spurted to all-time highs on a slew of positive domestic factors and robust FII buying ahead of high-stake elections.

The benchmark indices - S&P BSE Sensex and the CNX Nifty - were in a record-breaking spree. The former hovered near the key milestone of 22,000-mark, while the latter breached the historic landmark of 6,500 this week.

Aggressive buying by foreign institutional investors (FIIs), the main market mover, reflected their faith in Indian economy and its growth story in a week when the Election Commission announced the schedule for the Lok Sabha polls.

FIIs bought shares worth Rs 5,044.54 crore in the week, including provisional data of March 7.

Narrowing Current Account Deficit (CAD), rising rupee against the dollar and easing inflation played their part to boosting investor sentiment.

India's current account deficit fell to $4.2 billion, or 0.9 per cent of GDP, in December quarter of 2013-14 on the back of a rise in exports and fall in gold imports.

The lower CAD, the difference between outflow and inflow of foreign exchange, bolstered the rupee and attracted increased overseas investment. The Indian currency gained 68 paise, or 1.10 per cent, against the US unit in the week.

Barring healthcare, IT and teck shares, which performed poorly, all other sectoral indices surged. The rally was led by realty, banking, capital goods, metal, oil & gas and power stocks.

Sharp surge was seen in BHEL, ICICI Bank, Axis Bank, RIL, Bharti Airtel, HDFC Bank, Maruti Suzuki, L&T, SBI, Coal India, Hindalco, ONGC, Tata Steel, HDFC, Gail India and ITC.

The Bombay Stock Exchange 30-share gauge resumed lower on global meltdown on fears of an imminent war between Russia and Ukraine as possible sanctions by the West against Moscow, and touched a low of 20,920.98 on Monday.

Sensex bounced back after tension between Russia and Ukraine eased and China retained economic growth target for this year.

After that the BSE barometer never looked back. It rallied to a historic intra-trade high of 21,960.89 before settling at a new closing peak of 21,919.79.

The Sensex zoomed by a whopping 799.67 points, or 3.79 per cent, this week, logging the biggest weekly gain in more than 15 months.

Previously, it had flared up by 833.33 points, or 4.50 per cent, in the last week of November 2012. In the previous three weeks, the BSE benchmark has jumped by a staggering 1,552.97 points, or 7.62 per cent.

The broad-based CNX Nifty of the NSE zoomed by 249.70 points, or 3.98 per cent, to end at a record high of 6,526.65.

The 50-share index touched a new intra-day peak of 6,537.80.

The NSE index had hit an intra-day peak of 6,415.25 and a closing high of 6,363.90 on December 9, 2013.

Besides realty, banking counters, mainly PSU, attracted heavy buying interest after Finance Minister P Chidambaram said the Government will continue to provide capital support to state-run lenders.

Chidambaram on Friday said the fiscal and current account deficits are under control and the economy is more stable than it was 18 months ago.

HSBC Purchasing Managers' Index (PMI) for manufacturing stood at 52.5 points in February, a one-year high. It was 51.4 points in January.

For the next week, market will look after the upcoming data like IIP, CPI for urban and rural India and WPI.

Jignesh Chaudhary, Head Of Research, Veracity Broking Services said,"Indian equity markets started the week on a pretty negative note trailing the weak GDP data and the geo-political situation arising in the Eastern European region which put a lot of stress in the European and regional Asian markets.

Thereon, markets had a splendid positive run during the week and ended at an all time high supported by favourable buying spree by the FII community who have shown tremendous faith in the Indian markets."

"This along with good improvements in the macro-economic factors and Current Account Deficit numbers, which after a long time has shown some surpluses helped the markets to make all time new highs during its journey towards 22,000 levels.

"However, we might see some corrections next week in this strong rally due to profit bookings and anticipate Sensex to trade in the range of 21160 to 22,330. Nifty too should trade in the positive band of 6220 to 6760 levels," he added.

Twenty-three scrips out of the 30-share Sensex pack ended higher, while others finished lower. Major gainers were Hindalco (18.60), Icici Bank (15.10 pc), Axis Bank (11.14 pc), BHEL (9.87 pc), Maruti Suzuki (9.43 pc), RIL (8.73 pc), Coal India (8.38 pc), ONGC (8.20 pc), L&T (8.05 pc), SBI (7.64 pc), Tata Steel (7.62 pc), HDFC bank (6.57 pc), Gail India (4.96 pc), SSLT (4.84 pc), Bharti Airtel (4.83 pc), HDFC (3.70 pc), NTPC (3.24 pc) and ITC (3.07 pc).

However, Dr Reddy's Lab dropped by 6.04 pc, followed by Wipro 5.23 pc, Sun Pharma 4.75 pc, TCS 2.10 pc, Infosys 2.07 pc and Tata Motors 1.93 pc.

Among the S&P BSE sectoral indices, Realty shot up by 12.97 pc, followed by Bankex 10.44 pc, CG 8.15 pc, Metal 7.94 pc, Oil&Gas 7.72 pc, Power 5.38 pc and CD 3.89 pc while HC dropped by 4.33 pc, IT 2.78 pc and Teck 1.32 pc.

Total turnover at both the BSE and NSE rose to Rs 14,514 crore and Rs 65,708 crore, respectively, as against the last weekend's level of Rs 8,232 crore and Rs 45,114 crore.