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Dalal St snaps 3-week winning streak, FII inflows continue

Experts believe the market may surpass its January 2008 record of hitting 6357 on the Nifty and 21206 on Sensex in the next few days, may be by end of September quarter earnings season.

The market snapped its three-week winning streak with profit-booking stealing nearly a percentage point from the Sensex; but consistent inflows of foreign money kept a check on the downside. Overall, it was a consolidation time for the market after a 6 percent rally witnessed in the previous three weeks. Besides hitting the 21000-mark intraday for the first time since November 2010, the Sensex did nothing extraordinary and moved in the 20700-20900 band throughout the week; its NSE counterpart gyrated in the 6100-6200 range. This week, the Nifty fell 44.45 points to 6189.35 and the Sensex lost 199.37 points to 20882.89, thus remaining 168 points and 323 points away from their respective record highs. Experts believe the market may surpass its January 2008 record of hitting 6357 on the Nifty and 21206 on Sensex in the next few days, may be by end of September quarter earnings season. "There is a good chance that there could be an overshoot on the upside and all-time high could be breached in the next few days," believes Sandeep Shenoy, Anand Rathi Financial Services. However, if all-time high levels are not taken out before the end of the earnings season then the peak will not be attained, warned Shenoy. He advised long-term investors to sell into the rally whenever it happens as re-enter the market 3-5 percent lower. Post earnings, he does not see any other trigger for the market. Meanwhile, September quarter earnings were largely higher than analysts' expectations. While, stellar performance by ICICI Bank was the most-talked about result this week, other private sector banks like Kotak Mahindra Bank and YES Bank too beat street forecast by a wide margin. Companies like Asian Paints , Zee Entertainment and TVS Motor Company also impressed the street with their Q2 numbers. However, cement companies disappointed due to lower realisation during seasonally weak quarter. Idea too reported dismal performance while Wipro remained a laggard in terms of dollar revenue growth guidance compared to peers TCS , HCL Technologies and Infosys . ITC's sales volume growth in Q2 let down the street as well. Capital goods and banks saw buying interest with BSE Capital Goods Index and Bankex rising 5.4 percent and 1.6 percent each whereas FMCG, healthcare, IT and oil & gas were under pressure Among largecaps, L&T, Bank of Baroda , GAIL and Asian Paints were the biggest gainers, rising 5-9 percent while BHEL , JSPL, Wipro and Hindalco lost ground with 5-7 percent loss. In the midcap space, Jubilant Lifesciences and Suzlon surged 38 percent each while Karntaka Bank lost 8 percent. Meanwhile, foreign institutional investors were net buyers in October so far. They have bought more than Rs 13,000 crore worth of shares (including Friday's provisional figure) in current month, in addition to Rs 12,633 crore worth of buying in September. The rupee stayed in the 61-62 range against the US dollar this week. Source: MoneyControl

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