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Saturday, January 07, 2012

First week of 2012 ends in green

It was a volatile week for the Indian markets, with the Sensex closing 2.55% higher and the Nifty up by 2.65%

Major news for the week

Factory activity hits six-month high

November exports rise 3.9%

India's services sector grows at fastest pace in 5 months

Union Budget to be presented after March 9

Food inflation at -3.36% vs 0.42%

Govt to notify 100% FDI in single brand retail soon

RBI likely to ease policy: Subbarao

Govt allows foreign individuals to play in stock markets

Third quarter earnings to set direction

The near term major trigger for the market is Q3 December 2011 results. The focus will be on guidance from the company managements on outlook for the remaining part of the year and for the next year. Analysts expect weak Q3 December 2011 results due to lower volume growth in a slowing economy, higher raw material costs and higher interest charges.

IT bellwether Infosys and housing finance major HDFC kickstart the Q3 December 2011 earnings season on Thursday, 12 January 2012, among major companies. IndusInd Bank will announce Q3 December 2011 result on Tuesday, 10 January 2012. Development Credit Bank and GRUH Finance will announce their Q3 December 2011 result on Thursday, 12 January 2012. Sintex Industries and Triveni Turbine will consider their Q3 December 2011 results on Friday, 13 January 2012.

Volatile week ends with gains

The government's decision to allow qualified foreign investors to invest directly in local equities helped the market register gains on the first trading week of the New Year. Data showing a sharp improvement in manufacturing activity in December 2011 and a steep decline in food inflation in late December 2011 underpinned sentiment.

Comments by Reserve Bank of India governor that the central bank is likely to begin easing monetary policy to address concerns about economic growth also boosted sentiment. However, concerns about upcoming Q3 December 2011 earnings kept gains in check. Trading was volatile throughout the week.

Markets close flat on special trading session

The Indian markets were volatile on the special trading session, moving between negative and positive zones. Trading volumes were low. The cues from the US stocks were positive after better-than-expected jobs data for December while Asian indices were shut for the day.

Markets were open today because the NSE was upgrading its Futures & Options trading system hardware and software system. Trading took place in capital market segment, F&O segment and Securities Lending & Borrowing Scheme between 11.15 am to 12.45 pm.

BSE Small-Cap, Mid-Cap indices nudge higher

Key benchmark indices registered small losses during the special 1-1/2-hour trading session held today, 7 January 2012. The barometer index, BSE Sensex, was down 18.93 points or 0.12%, off close to 50 points from the day's high and up close to 15 points from the day's low. The market breadth, indicating the overall health of the market was strong. BSE Small-Cap and Mid-Cap indices edged higher.

PSU stocks surged. Shares of organised retailers jumped for the second straight day after Industry Secretary, P.K. Chaudhary said on Friday, 6 January 2012, that the government is soon expected to issue the notification allowing 100% foreign direct investment in single brand retail. Capital goods stocks rose on bargain hunting after a steep decline last month. IT stocks rose on strong economic data in the US, the biggest outsourcing market for the Indian IT firms. Realty major DLF rose on bargain hunting after recent steep slide.

Market may remain volatile during special trading session

The market may remain volatile and volume will be thin during the special 1-1/2-hour trading session being held today, 7 January 2012. The special trading session is being held today, 7 January 2012, as the National Stock Exchange is upgrading the capacity of its futures and options trading system hardware and software. Trading will take place from 11:15 IST to 12:45 IST. Trades done on today, 7 January 2012, will be settled on Tuesday, 10 January 10, 2012, as a separate settlement, NSE said.

Key benchmark indices registered marginal gains after witnessing wild intraday gyrations in the latter part of the trading session on Friday, 6 January 2012. The BSE Sensex rose 10.65 points or 0.07% to settle at 15,867.73, its highest closing level since 4 January 2012.