Markets Fall For First Time in 2012
DSIJ Intelligence / 25 Feb 2012
For the first time in 2012 the markets have yielded negative returns for a week as they plunged down by a hefty 2 per cent.
For the first time in 2012 the markets have yielded negative returns for a week as they plunged down by a hefty 2 per cent. It was not only the benchmark indices but also the broader market indices like the small cap and mid cap indices fell heavily this week.
| Benchmark Indices | |||
|---|---|---|---|
| Index | 17-Feb-12 | 24-Feb-12 | % Change |
| SENSEX | 18289.35 | 17923.57 | -2.00 |
| NIFTY | 5564.30 | 5429.30 | -2.43 |
| Hang Seng | 21491.62 | 21406.86 | -0.39 |
| Nikkei | 9384.17 | 9647.38 | 2.80 |
| Shanghai | 2357.18 | 2439.63 | 3.50 |
| Dow Jones* | 12904.08 | 12982.95 | 0.61 |
| S&P 500* | 1358.04 | 1365.74 | 0.57 |
| NASDAQ* | 2959.85 | 2963.75 | 0.13 |
| Bovespa* | 66141.74 | 65942.70 | -0.30 |
| FTSE* | 5885.39 | 5935.13 | 0.85 |
| DAX* | 6751.96 | 6864.43 | 1.67 |
| CAC* | 3393.25 | 3467.03 | 2.17 |
There were number off global as well as domestic woes which led to the downfall this week. Ranging from the Fitch downgrade of Greece to the soaring crude prices or to PMEAC’s pessimistic outlook of our domestic economy, market sentiments were heavily bearish this week.
| Key Global Indicators | |||
|---|---|---|---|
| Index | 17-Feb-12 | 24-Feb-12 | % Change |
| Gold | 28040 | 28678 | 2.28 |
| Silver | 55896 | 58467 | 4.60 |
| Crude Oil (Brent) | 119.03 | 125.07 | 5.07 |
| Crude Oil (Nymex) | 102.88 | 109.62 | 6.55 |
The week also saw the govt. announce its first ever nationwide CPI data which came in at 7.65 per cent for January. The latest CPI reading which come around 110 bps higher to the WPI data released earlier in Feb has somewhat dampened hopes of a rate cut by the RBI at its policy review meet on March 15. The reading shows a sharp increase in the cost of services, something not factored in the Wholesale Price Index.
| Currency Rate | |||
|---|---|---|---|
| Index | 17-Feb-12 | 24-Feb-12 | % Change |
| USD | 49.39 | 48.96 | -0.87 |
| EURO | 64.90 | 65.63 | 1.13 |
| GBP | 78.20 | 77.40 | -1.02 |
| JYP (per 100) | 64.42 | 60.79 | -5.65 |
There were also some disappointing developments on the corporate front, as Kingfisher Airlines had to ground more than half its fleet after IT Dept. froze its bank accounts over non-payment of tax dues. Also the Sterlite and Sesa Goa merger failed to bring cheer to market participants as shareholder of Sterlite felt the company balance sheet would have to accommodate the heavy debt from Cairn in the event of a merger. Sesa Goa shares tumbled after the I-T department disapproved of Rs 246 crore of tax deductions for three of its export units.
One of the major highlights of the week was the Multi-Commodity Exchange (MCX) IPO offer, which got over-subscribed by 53 times, reflecting a strong appetite among the investor community. However, too much money flowing in that direction caused a temporary liquidity crunch of sorts in the secondary market, and contributed to the weakness.
| Sectorial Indices | |||
|---|---|---|---|
| Category/Index | 17-Feb-12 | 24-Feb-12 | Change (%) |
| Broad | |||
| MIDCAP | 6,544.56 | 6,300.07 | -3.74 |
| SMLCAP | 7,116.49 | 6,857.04 | -3.65 |
| BSE-100 | 9,641.94 | 9,369.95 | -2.82 |
| BSE-200 | 2,262.14 | 2,197.69 | -2.85 |
| BSE-500 | 7,076.99 | 6,871.91 | -2.90 |
| Sectors | |||
| REALTY | 2,079.72 | 1,928.46 | -7.27 |
| BANKEX | 12,736.09 | 12,068.47 | -5.24 |
| CG | 11,106.78 | 10,560.97 | -4.91 |
| METAL | 12,572.46 | 12,072.82 | -3.97 |
| PSU | 7,909.08 | 7,639.16 | -3.41 |
| POWER | 2,363.28 | 2,287.72 | -3.20 |
| AUTO | 10,319.20 | 10,033.24 | -2.77 |
| CD | 6,647.43 | 6,544.35 | -1.55 |
| HC | 6,375.30 | 6,279.22 | -1.51 |
| TECk | 3,689.31 | 3,681.78 | -0.20 |
| OIL&GAS | 8,644.71 | 8,652.69 | 0.09 |
| IT | 6,266.87 | 6,309.02 | 0.67 |
| FMCG | 4,153.20 | 4,190.01 | 0.89 |
Among the sectorial indices, the Realty sector which was among the top gainers for most part of early 2012, tumbled down heavily this week by 7 per cent to top the losers chart. Bankex was another loser who lost heavily as hopes of reversal in key policy rates dimmed this week. The FMCG and IT though flat showed quite some resilience this week.
| Top Losers | ||
|---|---|---|
| Scrip | CMP | % Change (WoW) |
| Rural Elec | 205.20 | -17.37 |
| GMR Infra | 27.35 | -16.36 |
| IRB Infra | 174.40 | -16.01 |
| Dish TV | 57.50 | -14.12 |
| Indiabulls | 203.80 | -13.72 |
| United Spi | 587.45 | -13.34 |
| PFC | 191.55 | -13.09 |
| JSW Energy | 63.10 | -13.03 |
| HDIL | 107.90 | -12.06 |
| CESC | 256.20 | -11.84 |
| Top Gainers | ||
|---|---|---|
| Scrip | CMP | % Change (WoW) |
| Oracle Fin | 2583.05 | 18.89 |
| Godrej Ind | 250.70 | 16.44 |
| Videocon I | 188.35 | 8.22 |
| Bajaj Fins | 579.00 | 6.65 |
| Amtek Auto | 142.15 | 5.92 |
| BPCL | 653.10 | 5.53 |
| Gitanjali | 405.45 | 5.53 |
| Indrapra G | 358.25 | 5.06 |
| ColgatePal | 1057.75 | 4.67 |
| GlenmarkPh | 313.20 | 4.33 |
Among the individual stocks, REC, GMR Infra and IRB infra were among the top losers for this week. Among the top gainers, were Oracle Finance, Godrej Industries, BPCL and Colgate.
| Institutional Turnover | ||
|---|---|---|
| Date | FII | DII |
| 21-Feb-12 | 1400 | -1244 |
| 22-Feb-12 | 830 | -1333 |
| 23-Feb-12 | 105 | 641 |
| 24-Feb-12 | 1056 | 837 |
| Total | 3391 | -1099 |
In conclusion, we expect volatility to continue on the bourses and accentuate over the next couple of weeks as the Union Budget 2012-13 inches closer. Also the last leg of UP elections would add to it. We urge investors to continue booking profits on investments that have yielded significant gains over these past few weeks. We recommend readers to book profits and keep cash in hand to buy again at cheaper prices.
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